Apple's US App Store Revenue Surges Ahead of Earnings, Defying Epic Games Ruling Impact

Apple's App Store revenue has surged ahead of earnings, with US revenue accelerating in July and showing no negative impact from the Epic Games v. Apple ruling, according to Morgan Stanley. The firm expects US App Store revenue to grow 25% year-over-year in Q3, despite concerns that the court ruling would negatively affect the business.

Apple's App Store revenue has shown remarkable resilience, with US revenue accelerating in July and demonstrating no negative impact from the Epic Games v. Apple ruling. Morgan Stanley analysts predict a 25% year-over-year growth in US App Store revenue for the third quarter, despite initial concerns that the court ruling might negatively affect the business [3].

The ruling, which came into effect on July 31, 2024, was part of a long-standing legal battle between Epic Games and Apple over alleged anticompetitive practices in the app store ecosystem. Epic Games had challenged Apple's policies, including its control over the App Store and digital payments, arguing that these practices stifled competition. Despite the ruling, Apple's App Store revenue continues to grow, indicating that the market remains robust and resilient to such legal challenges [1].

The positive outlook is further supported by Morgan Stanley's expectations for Apple's overall revenue in the third quarter. The firm anticipates revenue to hit $90.7 billion, with a 5.8% year-over-year improvement, driven by strong performance across various product categories, including iPhone, iPad, and Mac [3].

The resilience of Apple's App Store revenue underscores the company's ability to navigate regulatory challenges and maintain market dominance. The continued growth in App Store revenue suggests that users and developers remain confident in the platform's offerings, despite the ongoing legal battles. As Apple continues to innovate and adapt to the evolving regulatory landscape, investors can expect the company to maintain its strong performance in the app store market.

References:
[1] https://gizmodo.com/apple-crushes-epics-app-store-dreams-ceo-s-petty-tweets-1851312958
[2] https://www.mlex.com/mlex/articles/2365884/apple-google-ruling-in-epic-games-antitrust-case-delayed-to-aug-12
[3] https://appleinsider.com/articles/25/07/21/morgan-stanley-upbeat-about-apples-q3-fortunes-in-spite-of-tariff-troubles