Apple App Store net revenue fell about 5% in September, according to Morgan Stanleythe steepest drop to business activity since the bank began data modeling in 2015.
Morgan Stanley analyst Erik Woodring wrote in a report Monday that the App Store has seen declines in markets including the US, Canada and Japan. His analysis is based on data from Sensor Tower, a company that tracks app downloads and sales.
Morgan Stanley said the main culprit for the drop was gaming revenue, which fell 14% in September, according to the data. Apple customers may spend less due to economic concerns, Woodring writes. Around the world, consumers are facing rising inflation and recession risks.
“We believe the recent App Store results clearly show that global consumers have somewhat reduced App Store spending in the near term as discretionary income is reallocated to regions. have pent-up need,” Woodring wrote in the note.
Morgan Stanley analysts also expect sales on Google Play, the main Android app store, to drop. They estimate sales there fell 9% in September.
Apple takes 15% to 30% of app purchases and in-app purchases made on iPhones and other Apple devices. Apple doesn’t report App Store sales, but puts it in the services business, which also includes subscriptions and warranties like the Apple One. Morgan Stanley expects Apple’s total services revenue to grow 8% in the September quarter.
Apple The service unit has become a focal point for investors who want to see iPhone and Mac customers spend more after purchasing their devices. For the June quarter, Apple reported a 12% increase in services revenue to $19.6 billion.
Luca Maestri, Apple’s chief financial officer, said in July that the company expects services growth of less than 12% in the September quarter due to the macroeconomic environment and strong US dollar.
Maestri also blamed difficult comparisons with enhanced service outcomes during the Covid-19 pandemic.
“Our services business a year ago has grown a lot and so it’s a bit difficult to compare. So we don’t have a specific number to give today,” Maestri said. speak. “Of course, we expect to grow.”
