Apple today is sharing some good news in the wake of yesterday’s reveal of a significant, market-moving cut to its revenue forecast, attributed to declining iPhone sales in China’s slowing economy. The company says its App Store, at least, was having a good holiday as customers spent $1.22 billion during the 2018 holiday season and broke a new single-day record on New Year’s Day.
The $1.22 billion in App Store spending occurred between Christmas Eve and New Year’s Eve, Apple said. This is typically the peak season for App Store consumer spend, as customers load up new iPhones and iPads with apps, and spend their App Store Gift Cards on paid apps and games.
Apple also said customers spent over $322 million on New Year’s Day 2019, which set a new record for single-day spend.
Over the holidays, games and self-care apps were the most popular categories, with Fortnite and PUBG among the most downloaded games, along with Brawl Stars, Asphalt 9 and Monster Strike. Meanwhile, as the New Year kicks off, customers are now turning to health and fitness apps, educational apps, and productivity apps – likely to some extent inspired by their New Year’s Resolutions. The apps leading these categories include 1Password, Sweat, and Luminosity.
Apple CEO Tim Cook, in his letter yesterday, signaled that the App Store was one of the bright spots in the company’s “Services” category, even as he delivered the crushing news of a slowdown in iPhone sales. The company said it is now expecting $84 billion in the quarter that ended Saturday, down from its earlier estimate of $89 billion to $93 billion.
However, “Services” generated over $10.8 billion in revenue during the quarter, with each geography hitting a new quarterly record. The company said it’s still on track to achieve its goal of doubling the size of this business from 2016 to 2020.
Today, Apple noted that the “Services” business set all-time records beyond the App Store in App Music, Cloud Services, App Pay, and the App Store’s search ad business.
A record-breaking end of the year for the App Store shouldn’t come as a surprise, given that the overall app economy is continuing to grow, with mobile games continuing to drive revenues and the subscription app business also making gains. App Annie recently predicted app stores will surpass $122 billion globally in 2019, including the App Store, Google Play, and third-party Android app stores in China, combined.
Prior to Apple’s report, app store intelligence firm Sensor Tower had last week noted that the U.S. App Store broke spending records on Christmas, with a record of $54 million on that day alone – up 31 percent over the year before. It had also passed the $52 million spent on Black Friday 2018, the firm said.