Applovin Stock Plummets 23.55% in Highest Trading Volume of the Year Amid Tariff Uncertainty

On April 1, 2025, Applovin (APP) experienced a significant decline, with its stock price dropping by 23.55% to $20.75 billion in trading volume. This marked a notable shift from its previous performance, where it had seen unusually high trading volume on Friday, with approximately 6,112,874 shares traded. The stock's recent volatility can be attributed to broader market conditions, including the implementation of new tariffs and the overall economic uncertainty.

AppLovin's stock has been under pressure due to the administration's tariff policies, which have introduced significant structural changes to the market. The implementation of a 25% tariff on all U.S. auto imports, effective April 3, has particularly impacted the automotive sector, which is a key area for Applovin's business. This tariff, along with the doubling of Chinese tariffs to 20%, has forced market participants to reassess their positions and price in structural rather than transitory trade friction.

The economic policy uncertainty index has reached levels not seen since the initial COVID-19 dislocation, reflecting the market's difficulty in efficiently pricing these policy shifts. The April 2 reciprocal tariff framework, which matches tariff levels on a country-by-country basis, has added to the complexity, with potential inclusion of non-tariff barriers such as VATs in the calculation. This has led to a significant repricing of risk across various sectors, including technology, where Applovin operates.

Despite the challenges, Applovin has seen some positive developments. Loop Capital Markets designated the company as a top pick, recommending "aggressive buying" on pullbacks. This endorsement has provided some support to the stock, which has been under pressure due to the broader market selloff. The technology sector, in particular, has experienced a synchronized breakdown, with key players like Amazon, Alphabet, and Meta breaching technical support levels. This has contributed to the overall weakness in the sector, which has historically been a market leader.

Looking ahead, the market's reaction to the April 2 reciprocal tariff announcement will be crucial. The implementation methodology, scope, and timing of these tariffs will determine the ultimate economic impact and how Applovin's stock will perform. Additionally, the non-farm payroll report and the initial Q1 2025 GDP estimate will provide critical insights into the economy's response to recent policy shifts and inflationary pressures. These factors will continue to influence Applovin's stock price in the coming weeks.