Apple did not create a single video game, but earns the most from them

Apple doesn't make video games like "Fortnite" or consoles like the Xbox. But without much fuss, CEO Tim Cook has turned the iPhone maker into one of the world's largest video game companies.

The key is the App Store, a digital marketplace where the company sells and distributes thousands of games from other companies and developers - and gets 30% of the sales. That explains a lot about the tech giant's current battles with competitors.

Who Apple was compared to

According to a Wall Street Journal analysis of data, in 2019 Apple made more gaming revenue than Xbox manufacturer Microsoft, gaming giants Nintendo and Activision Blizzard, and PlayStation manufacturer Sony Corporation all together.

Apple's gaming operating profits that year were $8.5 billion, exceeding the combined gaming operating profits of the other four companies listed for the same period. The tech giant claimed that the operating profits discussed in the lawsuit were flawed and, as a result, were too high.

How Much Apple Made

According to Sensor Tower, consumers spent a total of $45 billion on mobile games through the App Store in fiscal year 2020. Almost 31% of that money was spent in China and 26% was spent in the US; Apple's share was about $13.5 billion or about 5% of Apple's total sales that year, which was $275 billion. And 50% of Apple's revenue came from iPhone sales.

Unfortunately, WSJ or Sensor Tower have no information about what share of video games revenue Apple's own gaming service has.

Source: wsj

Illustration: apple