Apple TV+ is experiencing a significant cultural shift, largely due to the buzz surrounding the conclusion of Severance’s second season, airing tonight. However, regardless of its current achievements, a new analysis suggests that the platform has continued to be a financial burden for Apple even five years post-launch.
Apple TV+ remains unprofitable, despite an increase in subscriber count
Wayne Ma reports today in The Information, discussing the business landscape of Apple TV+, examining its revenue and subscriber dynamics after five years of service.
In this detailed article, Ma points out that Apple’s annual losses from TV+ surpass $1 billion. While the lack of profitability for the service has been common knowledge, this marks the first instance I recall where we have a definitive figure outlining those losses.
The report further mentions that Apple TV+ had 45 million subscribers last year.
However, it remains uncertain how many new subscribers Apple has welcomed during the current Severance surge. For instance, a recent Antenna report indicated that the streamer gained two million new subscribers within a month, marking a substantial increase.
Apple’s losses may not be as alarming as they seem
Previous reports have highlighted Apple’s efforts to curb spending, particularly in its film sector. While Apple’s original films have seen some success—most notably CODA being the first streaming service movie to win the Best Picture Oscar—the company has reportedly scaled back budgets due to several theatrical letdowns, now favoring direct-to-streaming releases.
On the television front, while there might be some budget adjustments in play, Apple has generally appeared willing to absorb its losses from TV+ as it nurtures the service’s growth.
It’s typical for streaming platforms to incur losses during their initial phases before ultimately achieving profitability, and Apple is strategically positioned to endure this phase longer than many competitors.
Although losing $1 billion is considerable, it represents a relatively minor dent given Apple’s overall lucrative performance.
For instance, in the last quarter, Apple reported $124 billion in revenue, with a profit of $36 billion from that amount.
Thus, while the $1 billion annual loss is significant, it isn’t nearly as problematic as it may seem at first glance.
What are your thoughts on Apple’s annual loss of $1 billion for TV+? Is it a concern or not? Share your views in the comments.
Apple TV+ is available for $9.99 a month, showcasing popular TV series and films such as Ted Lasso, Severance, The Morning Show, Silo, and Shrinking. There are also various ways to watch it for free.
