Apple App Store Growth Decelerated in July – Morgan Stanley
2022.08.03 19:02
Apple (AAPL) App Store Growth Decelerated in July – Morgan Stanley
By Sam Boughedda
According to a Morgan Stanley analyst, Apple’s (NASDAQ:AAPL) App Store net revenue growth decelerated to +1% year-over-year in July.
The analyst maintained an Overweight rating and $180 per share price target on Apple, writing in a research note that the firm “continue to closely watch App Store spending trends.”
“Based on the latest disclosures from Sensor Tower, we estimate App Store net revenue growth decelerated to +1% Y/Y in the month of July, a 1.5 point deceleration from 2.5% Y/Y growth in the month of June,” said the analyst. “Compared to the June Q, net revenue growth decelerated across all of the App Store’s 10 largest markets (which make up 87% of App Store spend), except for Germany and France. July App Store net revenue growth in China declined 8% Y/Y – a 5 month low – down from -6% Y/Y in June and +2% in the June quarter, driven primarily by a decline in gaming net revenue (-9% Y/Y in July) as COVID lockdowns eased.”
He added that with App Store year-over-year comparisons flat from July to August but six points tougher in September, they believe an acceleration in growth largely hinges on the strength of consumer spending and demand for digital services in China as spending patterns normalize post lockdowns.
“Based on these factors, we’d currently characterize the risk to App Store growth in the September quarter as more skewed to the downside, although it’s still too early in the quarter to adjust our forecasts.”
