Not only are U.S. iPhone owners willing to pay a premium price for their smartphones, they are also willing to spend more at the Apple Inc. (NASDAQ: AAPL) App Store. Average annual spending per U.S. iPhone user rose from $35 in 2015 to $40 last year, according to a new report from Sensor Tower.
U.S. iPhone users increased their average App Store spending on games from $25 in 2015 to $27 in 2016, but the largest percentage increase came in the entertainment category, where spending rose from $1.00 to $2.30 per user. Spending on music rose slightly, from $3.40 to $3.60 year over year.
App installs declined slightly, from 35 in 2015 to 33 in 2016, with game installs dropping from an average of 10.5 to 9.9 year over year. In fact, app installs declined in every category measured by Sensor Tower.
In May of last year, Sensor Tower reported that 1% of app publishers accounted for 94% of App Store revenue. These publishers included familiar names like Supercell, MZ, Spotify, Netflix and HBO. The total does not include shopping and services apps like Amazon or Uber that do not generate revenue either because they are free or do not support in-app purchases.
On a revenue basis, games represented 80% of U.S. App Store revenues in 2016, or more than $3.5 billion based on 132 million U.S. iPhone users. Apple retains 30% of total App Store sales.
Apple’s shares posted another 52-week high on Wednesday of $137.12. The stock’s 52-week low is $89.47, and the consensus 12-month price target is $140.14. The highest price target is $185.00.