Summary of Key Points
To address regulatory pressures from the European Union (EU), Apple has adjusted its app commission structure in the EU region: third-party app stores will now only be charged a 5% "core technology fee," while commissions within the official App Store vary between 15% and 26% depending on the payment method used (a significant decrease from the previous 30%). Additionally, Apple's service business has seen slower growth due to reduced commissions and weaker performance in the gaming sector, and its hardware business has been affected by rising storage costs, which have forced it to raise prices. As a result, Apple's stock price has experienced a decline followed by a slight rebound recently.
1. New EU Commissions: Apple's Commission Fees Have Been Significantly Reduced
Previously, Apple applied a uniform policy across the EU, requiring all iPhone apps to be distributed through the official App Store and using Apple Pay, with a 30% commission (15% for small businesses). To comply with EU regulations, Apple has now adopted a more tailored approach:
- Third-party app stores: If developers use their own stores but still leverage Apple's core technologies (such as iOS integration), they will be charged a 5% fee.
- Within the official App Store:
- For digital purchases using Apple Pay (e.g., in-game skins, memberships): 26% commission;
- For purchases using developers' own payment methods: 20% commission;
- For purchases directed to external websites: 15% commission.
- Discounts for small businesses: Small companies and partners receive an additional 5-10% reduction in commissions. For example, if a small business uses Apple Pay within the official App Store, they will only be charged a 15% fee.
These new rules took effect on October 1st, representing a significant concession by Apple in the EU market.
2. The Change Was Not Voluntary but Forced by Regulation
Apple's previous 30% commission rate was criticized worldwide as monopolistic, leading to regulatory scrutiny:
- EU: The EU introduced the Digital Markets Act, mandating the opening of third-party app stores and payment methods; otherwise, significant fines were threatened.
- USA: The US had previously adjusted the commission rates for external sales (27% for large companies and 12% for small businesses).
- China: In March this year, China reduced the standard commission rate from 30% to 25%, and for small businesses, it was lowered to 12%.
This EU regulation change was necessary for Apple; failure to comply would have resulted in even greater legal consequences and financial losses.
3. Slowing Service Business Growth and Regulatory Warnings
Apple's service business, which accounted for 28% of total revenue in Q3 2026, is facing challenges:
- Growth Below Expectations: Service revenue in Q3 2026 was $30.7 billion, a year-on-year increase of 12%, but it fell short of market expectations.
- Reduced Commissions as a Major Factor: Apple's financial reports explicitly stated that if developers use third-party sales channels, the company will receive lower or no commissions at all, which could impact revenue, profits, and stock prices.
- Other Hindrances: Factors such as exchange rate fluctuations (e.g., the appreciation of the US dollar, leading to reduced revenue in other currencies) and weaker mobile gaming sales (US users spent 6% less on the App Store in the second quarter) have also contributed to the slowdown.
Even analysts from UBS expressed concern, stating, "The slow growth of the App Store is quite concerning."
4. Hardware Business Strains: Rising Storage Costs Force Price Hikes
Apple's hardware business is also facing difficulties:
- Storage Shortages and Price Increases: Steve Jobs described the situation as a "once-in-a-century flood," leading to price increases for products like the iPad and Mac in June.
- New iPhone Pricing: With the new iPhone expected to be released in September, there are concerns that higher storage costs may result in price hikes. If prices increase, it could affect sales.
5. Volatile Stock Price
Apple's stock price has been highly volatile recently:
- After releasing its financial report at the end of July (showing below-expectation service growth), the stock price fell by 6.94%.
- On August 18th, when the EU commission changes were announced, the stock price rose by 1.45%, as investors viewed this as a resolution to the regulatory issues and a reduction in risk.
- Apple's current market value is $4.52 trillion, making it the largest company in the world, but investor confidence in its future growth has been shaken.
In summary, Apple's adjustments are a compromise to comply with EU regulations, but they may come at the cost of declining service revenue. Additionally, the hardware business is facing challenges due to supply chain issues. For consumers, this means there will be more third-party app stores available in the EU region, and some app purchases may become cheaper (as developers save on commissions). However, there is also a possibility that new iPhones could see price increases.