Apple touts record App Store holiday sales as tensions with software companies rise

Tech

A customer exits after picking up Apple’s new 5G iPhone 12 that went on sale, as the coronavirus disease (COVID-19) outbreak continues, at an Apple Store in Brooklyn, New York, October 23, 2020.

Brendan McDermid | Reuters

Apple‘s App Store customers spent a record $540 million on New Year’s Day alone, marking a 40% increase from last year, the company said Wednesday in its annual services report.

On top of that, Apple announced it generated $1.8 billion in App Store sales of digital good in the week between Christmas eve and now has 90 million monthly active users for its Apple Books app.

But the report didn’t provide updates on subscribers for its suite of newer subscription products like Apple TV+ (video streaming), Apple Music and Apple Fitness+ (a Peloton competitor). In the fall, Apple began bundling many of its subscription services together as part of its Apple One program. The Services category is a key growth area Apple has focused on in recent years as hardware sales growth has fallen.

Apple’s App Store update also comes as tensions continue to rise over Apple’s control over its App Store policies. Several app developers, most notably Facebook and Fortnite maker Epic Games, have publicly criticized Apple for taking a 30% cut of App Store sales from developers and for enforcing a new policy designed to disclose which apps track your data for targeted advertising. Apple recently altered its policies to take a 15% cut from companies that generate less than $1 million in App Store sales, which the company said was a move to help small businesses.

Overall, Apple’s Services generated revenue of $53.8 billion in the company’s last fiscal year, which ended in September 2021. Apple is expected to report its fiscal first quarter earnings in a few weeks.

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