It did not take long for e-commerce giant Amazon (AMZN) to take advantage of Apple’s (AAPL) legal setback. Indeed, Amazon has now made it easier for Kindle users on iOS to buy books following a recent court ruling against Apple. Previously, customers had to manually visit Amazon’s website through a browser to make Kindle purchases. Now, users can simply tap a new “Get Book” button in the Kindle app, which will automatically redirect them to a mobile browser for the purchase before sending them back to the app.
This change follows a federal judge’s order last week that required Apple to allow app developers to offer purchasing options outside of the App Store. Before the ruling, Apple’s policies prevented apps from directing users to external browsers for purchases and charged a 30% fee for in-app sales. To avoid that fee, apps like Kindle did not offer direct buying options within the app itself. Unsurprisingly, while Apple said it is complying with the ruling, it is also working on appealing the decision.
Although Amazon’s move today on its own will not impact Apple, especially since Apple was not earning commission from Kindle to begin with, the broader implications could indeed have a material impact on the company. Indeed, five-star analyst Wamsi Mohan recently warned that this court ruling has the potential to cost Apple billions of dollars in lost revenue. Nevertheless, he kept his Buy rating on Apple with a $235 price target due to the company’s strong earnings and potential to expand into new markets over time.
Is Apple a Buy or Sell Right Now?
Overall, analysts have a Moderate Buy consensus rating on AAPL stock based on 17 Buys, eight Holds, and four Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $228.84 per share implies 14.9% upside potential.
