As the world continues to grapple with the COVID-19 pandemic, people are always looking for more information about the public health crisis in order to stay safe. That's created a surge in engagement for Apple (NASDAQ:AAPL) News, the company's news aggregation platform that also features a dedicated COVID-19 section.
The tech titan reported fiscal second-quarter earnings last week, and CEO Tim Cook touted a new milestone for Apple News.
125 million and counting
On the conference call, Cook said that Apple News had reached 125 million monthly active users (MAUs). That's a significant spike from the 100 million MAUs that the service had in January. For context, it had previously taken Apple News a full year to add 15 million MAUs to get from 85 million to 100 million. Prior to that, Apple had said at WWDC 2016 that the service had 60 million MAUs -- two and a half years to add 25 million MAUs. The tech giant just added 25 million MAUs in a quarter.
"As Apple News reached 125 million monthly active users, we elevated trusted information from reliable sources through a special COVID-19 vertical," the chief executive said.
However, MAUs are not necessarily Apple News+ subscribers, who pay $10 per month. Apple has never disclosed how many News+ subscribers it has, but the paid subscription has reportedly struggled to grow beyond 200,000. CFO Luca Maestri vaguely noted that new first-party services like Apple TV+, Apple News+, and Apple Arcade helped contribute to overall growth in the services segment, without elaborating beyond that. Services revenue hit a record $13.3 billion last quarter, and paid subscription growth is finally accelerating.
Maestri also pointed out two segments within services that are being particularly impacted by the coronavirus outbreak: AppleCare and advertising. AppleCare, the company's extended warranty program, is taking a hit due to retail store closures, including Apple's own locations, as well as third-party repair partners.
"The other business which we think is going to be impacted by the overall economic weakness and the uncertainty on when businesses will reopen is advertising, which is the sum of our advertising business on the App Store, on Apple News, and the third-party agreements that we have on the advertising front," Maestri warned.
While ad monetization on Apple News has never been all that strong since the company's focus on privacy comes with some inherent trade-offs regarding ad targeting (or lack thereof), advertising is the only other way to make money from the service outside of paid subscriptions. The weak ad monetization has been a source of frustration for publishers.
Monetization concerns aren't that important overall for Apple, particularly compared to delivering timely news and information to users trying to navigate this unprecedented period.