Apple TV+ loses $1 billion annually despite over $5 billion investment

• Apple TV+ loses $1 billion annually despite over $5 billion investment since 2019
• Apple TV+ accounts for less than one per cent of total US streaming service viewership, trailing far behind Netflix and Amazon
• Apple’s services segment saw 13 per cent revenue growth to $96 billion in the last fiscal year

Apple TV+, Apple Inc. streaming service, loses $1 billion annually despite billions of dollars in investment in original content since its launch.

According to a report The Information released on Thursday, March 20, Apple has spent over $5 billion annually on content since launching Apple TV+ in 2019, though it reduced the budget by approximately $500 million in 2023.

Though Apple TV+ has recorded steady subscriber growth, largely relying on original films and series, it remains the only unprofitable Apple subscription service.

It still accounts for less than one per cent of total US streaming service viewership, trailing far behind Netflix and Amazon, with 8.2 per cent and 3.5 per cent of the market, respectively, as of February.

Apple’s services segment saw 13 per cent revenue growth

The financial struggles of Apple TV+ notwithstanding, Apple’s services segment has remained profitable, with revenue increasing by 13 per cent to $96 billion in the last fiscal year.

The segment includes Apple Music, Arcade, News+, and Fitness+, which are also struggling to grow.

Apple Music’s growth is reported to have declined with minimal profitability due to the high payouts to artists and labels, which exceed 70 per cent of its revenue.

Apple News+ and Fitness+ struggle with low engagement, while Apple Arcade had just two million users in its first year, with many on free trials.

Apple’s services segment further suffered challenges after the exit of its longtime executive, Peter Stern, in 2023.

Stern oversaw Apple TV+ and was said to have left the tech giant due to internal pressures to increase subscriber numbers.

After his exit, Apple restructured its services unit, separating Apple TV+, Apple Music, and international content from News+, Fitness+, and iCloud+.

Apple’s bundled subscription offering, Apple One, currently drives Apple services revenue. However, many of Apple One’s subscribers reportedly sign up primarily for iCloud+, rather than Apple’s other offerings.

Apple integrates ChatGPT, language support in latest iOS update

Meanwhile, TheRadar earlier reported that Apple integrated OpenAI’s ChatGPT into its devices in the latest update to the iOS, according to a statement by the iPhone maker on Wednesday, December 11.

The move aims to enhance user experience and increase the sales of Apple’s latest iPhones during the peak holiday shopping season.