Morgan Stanley: Apple’s App Store revenue growth slowed in June

According to a research note from Morgan Stanley analyst Katy Huberty, growth in Apple’s App Store revenue slowed down in June, potentially setting the company up for a slight shortfall in overall services revenue for the quarter.

Apple's App Store on iPhone
Apple’s App Store on iPhone

Eric J. Savitz for Barron’s:

Citing data from the app-store tracking service Sensor Tower, Huberty wrote that net revenue at the Apple App Store increased 2.5% in June, compared with 4% growth in May. Softness in downloads from China offset stronger performances in other markets.

For the June quarter, she estimates, App Store net revenue was up 5%… App Store growth actually accelerated in some markets, she said, with growth of 9% or more on a year-over-year basis in the U.S., Australia, Germany, and France. But revenue in China revenue was off 6%, reversing a 3% gain in May, she noted.

Huberty said the 5% estimate for App Store growth implies June quarter overall services revenue of $19.46 billion, a little below her current forecast of $19.53 billion, and the Street consensus at $19.71 billion. She added that she sees a path toward a reacceleration of App Store growth in the second half of the calendar year as comparisons ease.

MacDailyNews Take: With quarterly revenue of $19.46 billion, Apple’s App Store, if spun out as a separate business, would stand at No.182 on the 2022 Fortune 500 list. And that list is based on annual, not quarterly, revenue. At (very) roughly $80-$85 billion annual revenue, Apple’s App Store alone would stand at No.44 – No.39 on the 2022 Fortune 500 list.

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