Apple Arcade is well positioned to take a slice of booming gaming market, analyst says

Apple Arcade is a unique offering among gaming services and is well-positioned to take advantage of the booming market, according to JP Morgan.

In a note to investors seen by AppleInsider, JP Morgan analyst Samik Chatterjee gives a few thoughts on the rise of the Apple Arcade service. Chatterjee argues that the service has enough differentiation to stand out in the crowded market.

This is because Apple Arcade has a subscription model, which Chatterjee says is stickier. It's also a collection of exclusive titles, rather than aggregated content. Additionally, he said the simplicity of games adds to the overall potential market.

All of that bodes well for Services, the analyst points out. The global gaming market is expected to reach $360 billion by 2028. Mobile gaming will continue to expand beyond 50% of the mix that it already accounts for.

"We forecast Apple Arcade subscribers to expand rapidly, led by the ramp in popular titles, leading to an estimated 70 [million] subscribers by 2025 which by our estimate will lead to $1.2 [billion] in revenues for the service," the analyst wrote.

Apple Arcade is a service available across the company's lineup of products. It offers more than 200 gaming titles from both larger studios and indie developers, and costs $4.99 a month.

Chatterjee is maintaining his 12-month Apple of $200, based based on a price-to-earnings multiple of 30x on his 2023 earnings estimate of $6.73.

27 Comments

Beats 4 Years · 3073 comments

About 2 years ago

Quibi also had a “sticky” subscription model.

If the content sucks, no one cares.

Change the headline to “APPLE is positioned to dominate the gaming market, but won’t”

Stabitha_Christie 3 Years · 582 comments

Beats said:

Quibi also had a “sticky” subscription model.

If the content sucks, no one cares.
Change the headline to “APPLE is positioned to dominate the gaming market, but won’t”

You also think Apple makes most of it's money from gaming...... so not exactly the best informed source on the subject.

Stabitha_Christie said:

Beats said:

Quibi also had a “sticky” subscription model.

If the content sucks, no one cares.
Change the headline to “APPLE is positioned to dominate the gaming market, but won’t”

You also think Apple makes most of it's money from gaming...... so not exactly the best informed source on the subject.

No. Apple makes most of its money from iPhone hardware. They make most of App Store money from gaming.

Edit:
Because I know more people with bad reading comprehension will continue to reply:

I used the word “dominate” because Apple still has platforms they have barely set foot in like Mac, consoles and 1st party IPs. Apple Arcade is a joke compared to Nintendo, Microsoft etc.

When I say “Apple”, I literally mean Apple. Not EA, not Rovio, not Zynga.

Game Center has been garbage for over a year and Apple has ONE game on the App Store that no one even knows about.

Beats said:

Stabitha_Christie said:

Beats said:

Quibi also had a “sticky” subscription model.

If the content sucks, no one cares.
Change the headline to “APPLE is positioned to dominate the gaming market, but won’t”

You also think Apple makes most of it's money from gaming...... so not exactly the best informed source on the subject.

No. Apple makes most of its money from iPhone hardware. They make most of App Store money from gaming.

Edit:
Because I know more people with bad reading comprehension will continue to reply:

I used the word “dominate” because Apple still has platforms they have barely set foot in like Mac, consoles and 1st party IPs. Apple Arcade is a joke compared to Nintendo, Microsoft etc.

When I say “Apple”, I literally mean Apple. Not EA, not Rovio, not Zynga.

Game Center has been garbage for over a year and Apple has ONE game on the App Store that no one even knows about.

Literal quote from you:

"Apple has also shown games have made them the most money and have created Apple Arcade."

There is no reading comprehension issue here. You said games make Apple the most money. Hop back in the clown car and move on.

Stabitha_Christie said:

Beats said:

Stabitha_Christie said:

Beats said:

Quibi also had a “sticky” subscription model.

If the content sucks, no one cares.
Change the headline to “APPLE is positioned to dominate the gaming market, but won’t”

You also think Apple makes most of it's money from gaming...... so not exactly the best informed source on the subject.

No. Apple makes most of its money from iPhone hardware. They make most of App Store money from gaming.

Edit:
Because I know more people with bad reading comprehension will continue to reply:

I used the word “dominate” because Apple still has platforms they have barely set foot in like Mac, consoles and 1st party IPs. Apple Arcade is a joke compared to Nintendo, Microsoft etc.

When I say “Apple”, I literally mean Apple. Not EA, not Rovio, not Zynga.

Game Center has been garbage for over a year and Apple has ONE game on the App Store that no one even knows about.

Literal quote from you:

"Apple has also shown games have made them the most money and have created Apple Arcade."

There is no reading comprehension issue here. You said games make Apple the most money. Hop back in the clown car and move on.

Yeah in response to where most of their App Store revenue is from.

OBVIOUSLY.

Nice try.