In review, according to CNBC’s analysis, Apple’s App Store has made $64 billion in revenue in 2020 alone. This is about a 28% increase from the estimated $50 billion it made 2 years ago which is such a great amount of growth for the App Store since it was only estimated that the increase between 2018 and 2019 be only 3.1%.
Many people have theories on why the sudden surge in revenue but most point it to the effects of the pandemic. Many would say that because of the prolonged quarantine periods, they resorted to purchasing games, and subscribing to fitness and productivity apps to try and stay active despite the isolation.
Although Apple doesn’t really publish reports dedicated to the app’s sales performance, it does include it with the revenue they get from their services – which is such a fast-growing category. Previously, the company would take as much as 30% cuts from most of the money coming into the App Store but has now loosened its grip and brought the cut down to 15% from developers who only make under $1 million per annum from the App Store. But even with the decrease in cut, analysts reckon that this isn’t likely to affect revenue estimates because the top 2% of App Store developers are able to generate at least 95% of the revenue.
Apple does a yearly report on how much they have paid to developers since 2008. With this information, CNBC uses that to calculate the App Store revenue number by subtracting last year’s numbers from this year’s and also accounts for Apple’s 30% cut. Apple doesn’t necessarily self-report them so calculations that have been made may seem rough, but it is as close as we can get. Regardless of that, there are two undeniable truths – the App Store revenue has grown way above forecast and it’s brought a lot of money for both developers and the company.