Apple’s Ads Business at Record High from Engaging App Economy Miracle

By Matthew Snyder

Is it a hidden secret that Apple has a big advertising business?  Apple recently reported record advertising revenues for its first fiscal quarter, which ended Dec. 25, 2021.

Even though Apple does not break out its advertising sales, it reported that its overall services operations are at a record high.  This includes advertising via App Store search ads from app developers promoting installs as well as Apple News ads,  “reached an all-time revenue record of $19.5 billion, up 24%, with all-time records for cloud services, for music, video advertising, and payment service,” CFO Luca Maestri said during an earnings call with analysts and investors.  He attributed the results to a “combination of factors,” citing the reason due to more and more engagement of our customers on all the services.”

Isn’t that the key to all advertising?  More engagement.  This is why at ResponsiveAds we are particularly focused on engagement-driven advertising and even with our partnership with Ads for Apple News we bring engaging solutions for our clients.

In the  Display, Video and Search Ads business there have been concerns about how Apple’s impact of its “App Tracking Transparency” framework, and the deprecation of its identifier for advertisers (ADFA) user device identifiers, but industry analysts believe it likely has shifted some ad spending from other platforms reliant on the data – like Facebook – to Apple.

This is still only a small fraction of  Apple’s services revenues representing only about 19% of the $104.4 billion in total sales during the quarter, CEO Tim Cook recognized the creation of the App Store that spawned them as an “economic miracle” created by the iPhone.

“A few weeks ago, we marked the 15th anniversary of the day Steve [Jobs] revealed iPhone to the world,” Cook said, adding, “We knew that we had the beginnings of something fundamentally transformative, though none of us could have predicted the incredible and meaningful impact it would have on all of our lives. The creative spirit that made the first iPhone possible has thrived at Apple every day since. We never stop creating. We never stop innovating.”

We believe that Apple will keep innovating especially in the advertising space bringing out solutions and platforms that are User-First and engagement-driven versus the very different methods taken by Google, Meta (Facebook), Amazon, and Tik Tok.

ResponsiveAds is a strong believer in the way Apple brings premium user-first solutions to market and is a guiding light for its business as well.