What happened?
Today, Apple (AAPL 1.27%) announced that its popular App Store enjoyed a busy holiday shopping season. The company said that during the two weeks ending January 3, it generated $1.1 billion in revenue from apps and in-app purchases, which set back-to-back weekly records in terms of both traffic and purchases. New Year's Day alone was the biggest sales day ever for the App Store, with customers spending more than $144 million.
Marketing chief Phil Schiller, who just recently took over leading the App Store, said that customers spent more than $20 billion in the App Store throughout 2015. Cumulatively, Apple has now paid out almost $40 billion to developers since the App Store was launched in 2008, with a third of this revenue being generated within the past year. Apple also pointed out that the App Store is now a potent job creator.
Does it matter?
Apple's robust content ecosystem of apps and other categories has long been a key to its success and customer loyalty. The majority of the innovation within the iOS platform comes from third-party developers, and Apple recognized this a long time ago. iOS is also the most promising platform for developers, because Apple users have a higher propensity to actually spend money on content and apps compared to Android users.
The Mac maker's broader services segment, which includes the App Store, has generated nearly $20 billion in revenue during the past four quarters. With today's announcement, this figure will likely exceed the $20 billion threshold when Apple reports fiscal first-quarter earnings later this month. Apple has often said that it operates its content stores around breakeven, but there's a good chance that App Store operating income is well into positive territory by now.
