Apple's (NASDAQ:AAPL) App Store delivered strong results in the September quarter, with revenue climbing 10% year-over-year to $8.7 billion and downloads rising 2.5% to 9 billion.
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The company also saw stronger monetization and a shift in revenue mix, as gaming's share declined while categories such as Productivity and Photo & Video posted steady growth, signaling healthier long-term trends alongside rising demand for artificial intelligence-powered apps.
BofA Securities analyst Wamsi Mohan maintained a Buy rating on Apple with a price target of $270.
Also Read: Apple Services Revenue Trajectory Signals Softness With Weaker App Store Downloads: Analyst
Mohan highlighted Apple’s strength in the App Store during the September quarter, including robust revenue growth, a healthier mix shift, and promising long-term trends tied to AI and app diversification.
The analyst noted App Store revenue rose 10% year-over-year in Apple’s fiscal fourth quarter of 2025, reaching $8.7 billion, according to developer revenue data from SensorTower. Total downloads across iPhone and iPad grew 2.5% year-over-year to nine billion during the same period, he noted.
Mohan emphasized that dollars per download increased 7.3% year-over-year to 97 cents, showing stronger monetization. For September alone, revenue rose 7% year-over-year, outpacing the 3% growth in downloads, the analyst said.
He cited strong capital returns, Apple’s eventual leadership in AI at the edge and optionality from new products and markets.
Mohan also noted the revenue mix continues to shift away from gaming, which bodes well for Apple’s long-term Services revenue. In the fourth quarter, games accounted for 45% of App Store revenue by category, down from historic levels above 50%, the analyst told. Productivity apps gained roughly 300 basis points year over year, the most significant growth among categories, he said.
While gaming remains the dominant contributor, Mohan viewed steady growth in categories such as Productivity and Photo & Video as constructive, since this diversification should support sustainable revenue growth. The analyst flagged Apple’s upcoming Oct. 21 appeal hearing in the Epic Games case as another key event for the App Store business.
On the AI front, he underscored how search-oriented AI apps are increasingly capturing daily active user share from the Alphabet (NASDAQ:GOOGL)(NASDAQ:GOOG) Google search app (excluding Safari and Siri).
Google’s app share slipped to 73% in September, down from 85% in January, Mohan noted. ChatGPT emerged as the biggest beneficiary, with its share increasing from 14% in January to 24% in August, according to the analyst.
Mohan highlighted how ChatGPT has successfully monetized its user base, with App Store revenue rising from about $10 million in January 2024 to roughly $215 million in September 2025.
Mohan projected fiscal 2025 sales of $416.04 billion and EPS of $7.39.
AAPL Price Action: Apple shares were up 0.46% at $258.32 at publication on Friday.
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