Apple says gaming slowdown and App Store changes hurt services growth
Apple said a slowdown in mobile gaming and changes to the App Store’s business model — including court-ordered payment rule changes in the U.S. — weighed on its services business, even as the company topped 1.5 billion paid subscriptions.
The slowdown in mobile gaming and changes to the App Store's business model are significant challenges for Apple's services growth. Mobile gaming has been a major driver of growth for the company, but a slowdown in this area suggests that the market may be maturing or that gamers are shifting their attention to other platforms. The court-ordered payment rule changes in the U.S. also likely had an impact, as they forced Apple to loosen its grip on in-app payments and potentially reduce its revenue from this area.
These changes matter because services have become an increasingly important part of Apple's business, with the company now counting over 1.5 billion paid subscriptions. As the iPhone market continues to mature, services have been seen as a key area of growth for the company. However, with a slowdown in mobile gaming and changes to the App Store's business model, Apple will need to find new ways to drive growth in this area. This could involve expanding into new markets or developing new services that can attract subscribers.
To watch next: how Apple responds to these challenges and whether the company can find new ways to drive growth in its services business. One area to keep an eye on is Apple's push into new markets, such as emerging markets or new categories like streaming fitness or education. Additionally, the company's upcoming plans for its App Store, including potential changes to its business model or new features for developers, will be worth watching to see if they can help drive growth in services.
Originally reported by techcrunch.com. AppNewsletter adds analysis for ai & agent economy readers.