Many of the big tech companies now fear slower growth in upcoming quarters, due to prevalent market conditions. Google recently warned employees of job cuts if productivity didn’t improve, along with the next quarterly results. Now, things aren’t as bad at Apple, but even they are facing some of the slowdown heat. It seems Apple is looking at its advertising business to combat some of that.
Recently, Bloomberg reported that Apple’s VP of Advertising Platforms, Todd Teresi, wants to significantly expand the advertising business to double digits from the current $4 billion every year. Moreover according to the Bloomberg article, Apple’s advertising team has also moved up in the company’s priority and the ad group’s vice president, Todd Teresi, now directly reports to current Apple services chief Eddy Cue.
Apple already displays ads across many of it’s services, like the App Store, Apple News, Apple TV+ and more. But the company could now be planning to display ads on Apple Maps. Google already offers ad services on its Maps platform, where businesses could pay to feature higher on certain searches. Apple Maps could have a similar form of advertisement, and according to the Bloomberg article, the idea has already been explored internally.
Look at the June quarter, we believe we saw macro headwinds that impacted our business and results. One of those is FX, over 300bp on YoY growth rates. Look at the product categories, on iPhone, no obvious impacts aside from FX. Mac and iPad were so gated by supply that we didn’t have enough product to test demand. Wearables, Home and Accessories, we did see some impact there that we would attribute to macroeconomic environment. When you look at Services, there were some Services that were impacted. Digital advertising were impacted by macroeconomic environment. Mixed bag in terms of what we believe that we saw. Overall, we’re very happy with the results and when you think about the number of challenges in the quarter, we feel really good about the growth that we’ve put up for the quarter.
– Apple CEO, Tim Cook, on Q3 2022 Financial Results
Another reason behind the aggressive push for ads across Apple’s platforms could be that the ad business is under pressure itself. As Tim Cook points out in Apple’s recent financial results, the company expects weaker ad growth due to economic headwinds. So it would make perfect sense to increase the ad collection base by introducing it to more platforms across Apple’s ecosystem.
So what does this mean for you? Probably more ads on your iPhone, and with any luck, the less annoying ones.