- Oct 24, 2017
Apple estimated to earn more from gaming than Sony, Microsoft and NintendoAnalysis suggests games generated $8.5 billion for App Store in fiscal 2019 alone
A new report suggests Apple is generating more revenue from video games than the three console platform holders -- despite not directly producing games or making games-specific hardware.
That's according to a Wall Street Journal analysis, which explored the profitability of the iOS App Store and gaming's contributions towards that.
The article cites Sensor Tower estimates that Apple received $15.9 billion from the App Store during the company's fiscal 2019 (October 2018 to September 2019).
Based on Apple's operating margin calculations, which were revealed during the Epic vs Apple trial earlier this year, the operating profit for the App Store was $12.3 billion that year -- accounting for almost a fifth of the company's overall profit.
Sensor Tower estimates that 69% of those revenues (just shy of $11 billion) came from gaming.
The WSJ's own analysis claims that Apple would have earned $8.5 billion from gaming, which it reports is $2 billion more than the operating profit generated during the same period by Sony, Nintendo, Microsoft and Activision.
The site based this on public financial records from Sony, Nintendo and Activision, and an estimate on Microsoft.
Apple disputed the operating margins during the trial and claimed they were inaccurate. CEO Tim Cook told the court the company never calculated the exact profitability of the App Store, and that the margins discussed were from a "one-off presentation."
However, he did confirm the majority of App Store revenue comes from games.
Sensor Tower estimates global spend on mobile games through the App Store reached $45 billion in fiscal 2020.
Last month, Judge Yvonne Gonzales Rogers revealed her judgment for Epic vs Apple, ruling that the latter was not a monopoly and sided with Apple on nine out of the ten counts in Epic's lawsuit.
The judge also sided with Apple's counterclaim that Epic Games breached it contract by introducing direct payments to Fortnite via a hotfix.
Epic is appealing against the ruling.
Source: Game Industry
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