Trouble For Apple As App Store Sees Record-Breaking Drop In Revenue Since Past Seven Years

The revenue figures at the app store witnessed a massive decline of nearly 5%. This is believed to be one of the biggest drops in the past seven years. Meanwhile, revenue for games also witnessed a staggering 14% decline as confirmed by analytical data from Sensor Tower.

The data was definitely surprising and those in charge of the financial modeling claim we haven’t seen such a picture since the year 2015. Hence, this is major news. But where did this sudden drop come from and why?

Well, reports from CNBC have gone on to speak about how it’s related to drops in markets like Canada, Japan, and America. Morgan Stanley’s analyst shed light in his report on the details of the matter.

For those that don’t know, Sensor Tower is famous for tracking both sales and downloads of apps across the board. According to them, the biggest culprit of them all is the gaming niche and since that fell so badly, it had an overall effect on revenue.

As was seen in Apple’s previous earnings call, the company stated how YoY comparisons were continually impacted thanks to the huge demand for entertainment at home. We do agree that lockdowns were out the door at this time in 2021. However, it definitely took some time for people to get back to their pre-pandemic routine. From visiting eateries to watching a movie in the theater, and the list goes on.

But another major confounding factor linked to this behavior had to do with sanctions coming ahead from Russia. Then there were disruptions in the supply of gas and that’s what led to the price of energy increasing massively.

The end result is uncontrollable inflation in so many nations. And that just left so many people with income that was never enough to be used elsewhere as basic necessities turned into luxuries.

Moreover, those that were not getting hit by this are still being cautious while spending their funds as they feel even tougher moments lay in front of them in the future. Then there’s news about how the revenue in the App Store may end up falling further in October as a further rise in prices takes center stage tomorrow all around the globe.

As a whole, the cost of app sales and in-app purchases may see a staggering rise of around 20%. The news comes as tech giant Apple is protecting all of its funds against the growing strength of the dollar currency.

Common countries that would be affected include the likes of Chile, South Korea, Pakistan, Sweden, Malaysia, Japan, and Egypt.

Apple has issued a reminder to developers in the App Store about how the new prices will take center stage from tomorrow.

But this comes as Apple gets more bad news in the form of pressure related to antitrust concerns. This has to do with its share of the revenue witnessed in the App Store. And the latest happenings are linked to a South Korean investigation of how the total charges are going above the 30% mark.

But the bank adds how services as a whole will rise with time. But the rate at which this growth is occurring is quite slow.

It’s interesting how the new report says the Cupertino firm fails to report an increase in sales but likes to include it in its services for business. The company has only mentioned how it hopes the revenue growth for Services would be a little less than 12% this year.

As can be seen, it’s definitely a tough time for Apple and many are not happy.

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