According to CNBC’s analysis, Apple’s App Store’s revenue in 2020 was US$64 billion, an increase of 28% from the US$50 billion in 2019. This represents a substantial increase in the App Store, as the estimated growth between 2018 and 2007 was only 3.1% in 2019.
It is difficult to explain the exact reason for the surge, but it may be related to the COVID-19 pandemic. We can say that based on personal experience, by 2020, we have purchased many more games than in the past few years, and also subscribed to fitness and productivity apps to try to regain control of our life during the isolation period.
When Apple reports its financials, it confuses the money it makes from the App Store with service revenue (currently its fastest-growing category). The company cut 30% from most of the funds entering the App Store, and despite some warnings and exceptions, it represents billions of dollars in revenue.
Although developers like Hey.com have recently responded, and even Epic has raised legal challenges, Apple usually acts cautiously.
However, its control has recently relaxed, because Apple now only cuts 15% of its developers from app stores with annual revenues of less than $1 million.
Analysts estimate that the top 2% of App Store developers will generate 95% of revenue, so revenue estimates will not change much.
Every year Apple reports how much money it has paid to developers since 2008. CNBC uses this to calculate the App Store revenue figures by subtracting last year’s figures from this year’s revenue and then arrives at Apple’s 30% reduction in expenses.
Although the numbers may be a bit rough, Apple will not report on its own, so all we can do is get close. In any case, two points are hard to argue: App Store revenue has grown a lot this year, and it has brought a lot of money to developers and Apple.