Apple doesn’t make games, but makes more money from them than Sony, Activision, Nintendo and Microsoft combined

Apple does not develop or release games, but thanks to App Store commissions, it makes more money on them than the major players in this market.

According to a report by The Wall Street Journal, Apple’s operating income from games on the App Store was $ 8.5 billion in fiscal 2019. The information became available in the course of the Cupertino company’s litigation with Epic Games.

This is a really huge amount. It is 2 billion more than the combined operating income of such giants as Sony, Activision, Nintendo and Microsoft! Of course, for an appropriate period of time. That is, Apple’s numbers are very impressive, both in absolute and relative terms.

And this is data for 2019, that is, before the COVID-19 pandemic, which led, among other things, to a sharp jump in people’s interest in games. If you compare Apple’s total operating profit from services for 2019 and its revenue from games, you can try to calculate the approximate operating profit generated by the company solely from games in fiscal 2020. This turns out to be about $ 9.9 billion.

True, it is worth noting here that in the court Apple and personally Tim Cook categorically denied such calculations provided in court, stating that the indicators of the gaming direction are greatly overestimated, and that Apple itself has never tried to determine the profit even of the App Store as a whole, not speaking already about the direction of play. According to Apple’s CEO, the practice of not tracking unit profitability dates back to Steve Jobs’ desire to foster collaboration between the various divisions of the company. According to him, the internal document in which the operating margin was calculated, which was not made public, was a one-time presentation. At the same time, Cook noted in court that most of the App Store’s revenue comes from games.

There is also another curious piece of statistics, albeit still for the 2017 financial year. It is reported that then only 6% of App Store gamers brought 88% of all revenue in this segment. On average, these people spent about $ 750 a year on games. At the same time, 1% of gamers brought Apple 64% of all revenue in the gaming segment. These users spent an average of $ 2,700 a year.