Apple: Developers Paid No Commission on 90% of 2024 Sales

A study estimates Apple's U.S. App Store facilitated $406 billion in developer billings and sales in 2023, nearly tripling from $142 billion in 2019, with over 90% of billings incurring no commission to Apple. U.S.-based developer earnings more than doubled over the past five years, with small developers seeing a 76% increase between 2021 and 2024, driven by growth in sectors like food delivery, entertainment, and enterprise apps. The App Store is also becoming a hub for AI-powered applications.

Analysis

Apple's (AAPL) U.S. App Store ecosystem demonstrated robust growth, facilitating $406 billion in developer billings and sales in 2023, a near threefold increase from $142 billion in 2019. Significantly, over 90% of these transactions incurred no commission to Apple, a detail that mitigates concerns about App Store fees and underscores the platform's value proposition for a broad developer base. U.S. developer earnings more than doubled over the past five years, with small developers experiencing a notable 76% earnings surge between 2021 and 2024, driven by sectors like food delivery, entertainment, and enterprise applications. The impending rollout of developer tools for Apple Intelligence, expected around June 9th, signals a strategic push into AI, potentially fostering a new wave of innovation on the platform. Concurrently, European financial institutions like Banco Santander (SAN) and BBVA (BBVA) are actively exploring or implementing crypto-asset services under the EU's new Markets in Crypto-Assets (MiCA) regulation. Santander's Openbank unit is reportedly seeking licenses to offer stablecoins and crypto access, while BBVA has already received approval in Spain for crypto custody and trading, indicating a trend towards regulated crypto adoption by established banks. This regulatory clarity under MiCA is facilitating a structured entry for major financial players into the digital asset space, potentially broadening mainstream access to cryptocurrencies.

Key Decisions for Investors

• Investors should view Apple's App Store performance, particularly the high proportion of commission-free transactions and strong developer earnings growth, as a positive indicator for sustained services revenue and ecosystem health; monitor Apple's Worldwide Developers Conference around June 9 for details on AI developer tools, which could unlock new growth avenues.
• Consider the strategic implications of major European banks like Santander and BBVA entering the regulated crypto market under MiCA, as this could signal a maturation of the digital asset class and present new revenue opportunities for these financial institutions, potentially de-risking crypto investments for retail clients.
• Evaluate investments in companies leveraging AI within app ecosystems, as exemplified by the App Store's increasing focus on AI-powered applications, which may represent a significant future growth driver in the technology sector.
• Monitor developments related to MiCA regulation and its impact on the broader adoption of crypto and digital assets by traditional financial institutions, as this framework could set a precedent for other jurisdictions and influence the competitive landscape.