Apple signaled on Monday that it may seek to boost its services revenue through third-party artificial intelligence applications and partnerships, though specific plans remain unclear. During an earnings call, Chief Financial Officer Kevan Parekh stated that AI offers opportunities across third-party apps and partnerships alongside first-party capabilities, though he did not elaborate on the exact nature of these opportunities. Reuters reported that investors are wondering whether Apple could profit by distributing third-party AI agents via the App Store and taking a cut of the revenue.
The potential push into third-party AI comes as Apple faces mounting regulatory and legal pressures that have cut into App Store commission revenue in several markets. Third-party estimates from August indicated an 18% drop in U.S. commission revenue, alongside declines in Brazil and Japan following new regulations. Additionally, a lawsuit by Epic Games forced the company to allow apps to redirect users to outside payment systems, further impacting a marketplace where Apple has traditionally controlled all payments tightly.
Despite these headwinds, Apple reported a record number of paid subscriptions with double-digit growth for third-party apps during the September quarter, even as mobile gaming faced a continued slump. CFO Kevan Parekh noted that the company expects services growth to reach between 8% and 9% in the December quarter. This financial outlook accounts for sequential headwinds, primarily from third-party licensing and foreign exchange impacts.
This development matters because integrating third-party artificial intelligence applications could help Apple offset declining commission revenues and regulatory pressures affecting its lucrative App Store business.