In order to increase revenue, Apple may expand its advertising to more of its first-party apps on the iPhone.
According to the report, the company is currently generating $4 billion in annual revenue from its ad business, but wants to grow it into a double-digit segment.
There are ads in Apple News and Stocks. The expansion of ads in the App Store was recently announced. The company is considering ways to add advertising to Apple Maps, which has stood out from the competition, according to a report. It is likely that Apple also inserts ads into the stores for books.
The report wasn't immediately available to comment on.
Other companies have been targeted by Apple.
A year ago, Apple released an update for their phones that asked users if they wanted to allow apps on their phones to target them for advertisements. The privacy feature, called App Tracking transparency, has changed the mechanics of many mobile ads.
The feature has presented major challenges to companies such as Facebook, as most users did opt out.
Apple may be able to squeeze more value out of its users.
According to analysts from Needham, Apple's next big revenue stream is in advertising.
They said that Apple has the best user data. If AAPL builds a demand side platform, it will be able to control how and where its data is used, and it will be able to prevent data leaks outside their walled garden.
According to the analysts, Apple is building a new mobile advertising platform. They said that there was a noticeable increase in the company's recruitment efforts for its Ad Platform, and that it was visible at the advertising festival in June.
In Apple's most recent earnings call, CEO Tim Cook and CFO Luca Maestri said the company's ads business experienced some Covid-related difficulties, but Cook said it is a great discovery tool for app developers.
According to analysts from Bernstein, Apple's Services business has seen a decelerated growth rate for the last four quarters as the App Store has experienced a shift in consumer spending.
Higher ad loads in the App Store are expected to grow Apple's ad business.
Over the next few years, we think at least 20% growth for Apple's overall advertising segment is doable.
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