Quick note on AAPL

I know I don't talk individual stocks particularly often, but thought it was worth flagging a big news story tied to the largest company in the world. 

Here's the news: 

JUDGE SAYS APPLE'S CONDUCT IN ENFORCING ANTI-STEERING RESTRICTIONS IS ANTICOMPETITIVE APPLE SHARES DROP TO SESSION LOW

Apple shares are down just over 2% at the time of writing. 

What does this ruling mean in practice? 

It means AAPL no longer is able to force developers to get people to signup to apps on the App Store interface and developers can route their payment systems through to websites (where they are not subject to the AAPL 30% fee). 

What's the long-term impact? 

I mean, surely AAPL is going to appeal this and we will keep going up through the relevant courts, but even if it stands does it make a huge amount of difference? Well, maybe according to Statista 2020 App Store revenue for Apple was USD72.3bn (obviously this is not profit, although gross margins are rumoured to be around 75%+) so this could be a sizeable hit to the bottom line if this changes consumer habits drastically. But here's the thing, it's not like you could actually signup to Netflix on an iOS device, you always had to signup elsewhere then use the App. 

Much of the revenue came from in-app purchases. As I'm writing AAPL is now down only 1.6%, let's see what happens by the end .

So is this going to kill the App Store forever? Well it depends firstly on appeals (and I have a sneaking suspicion the Supreme Court (of Republican appointees) will rule in favour of Apple if it gets there), but really there is still a lot of revenue to be had from in-app purchases. 

Also worth bearing in mind the ruling helps App Developers, so theoretically could see an increase in use of the App Stores. Other thing to bear in mind, what does this imply for Google in the long-term... it also uses some similar high charging methods in its Android store. 

Who are the winners? 

EPIC obviously (UPDATE: or perhaps not... at no point does the judge order Apple to let EPIC back onto the store... the implication being it should only do so if it wants to)... perhaps less obviously look to Microsoft. A big win for Office 365. Means they probably end up retaining an extra bit of cash there. 

AAPL. I'm always hesitant so short Apple, this win for EPIC probably means they can lie low for a while and not be subject to too much scrutiny elsewhere in my opinion. Apple has been dealt its blow, its not a killer one, and what's coming for Amazon next might be far worse. 

AAPL down 2.2%. 

Have a good weekend all.

CORRECTION: This article states that Apple App Store revenue was USD72.3bn. This is actually total App Store sales, rather than revenue to Apple from the App Store. Apple takes generally 30% of this, so you can approximate the revenue as 24bn (on which there would then be a 60% + margin).