Apple implies it generated record revenue from the App Store during 2021
Apple said Monday that it paid developers $60 billion in 2021, or $260 billion total since the App Store launched in 2008. It’s a figure that suggests App Store sales continue to grow at a rapid clip.
By comparison, Apple said in 2019 it had paid developers a total of $155 billion since 2008. And at the end of 2020, it said it had paid $200 billion, an increase of $45 billion. Monday’s figures show a jump of $60 billion.
The statistic came as part of a broader announcement from Apple meant to show momentum for its services business, which is an important signal for investors and analysts, who like to see Apple not only making money from selling hardware but also through selling services and apps to its customers, such as app downloads.
Apple’s payments to developers account for between 70% and 85% of Apple’s total gross from its App Store, which takes between 15% and 30% of sales from digital purchases made in apps.
In the past, it’s been possible to back into a rough estimate for Apple’s App Store total revenues by assuming the payments to developers was equal to 30% of Apple’s total App Store sales. But, in the past year, the company changed its commission structure several times in response to regulators and legal challenges.
In particular, in 2021 Apple introduced the Small Business Program, which cut fees to 15% for developers who make under $1 million per year. According to estimates, as many as 98% of App Store developers fall into this category, but it accounts for only a small fraction of total sales.
Apple also introduced a program for news apps that would slash their fees to 15% if they provided content to Apple News in August. For all developers, Apple also only takes 15% of the second year of a subscription, instead of 30%.
If Apple’s commissions were uniformly at 30%, it grossed $85.71 billion in App Store sales in 2021 at the highest, based on CNBC analysis. If Apple’s commissions were all 15%, it would come in lower, at $70.58 billion.
Last year, CNBC analysis suggested that Apple’s App Store grossed more than $64 billion in 2020, based on a 30% commission rate.
Apple also said on Monday that it had 745 million paid subscriptions, which include Apple-provided services like Apple Music and iCloud, and also includes any customer who subscribes to an app through the App Store. That’s up from 700 million last summer.