A federal appeals court recently upheld a ruling that requires Apple (AAPL) to allow third-party payment links in its App Store, which has analysts worrying about how this could affect the tech giant’s earnings. Indeed, analysts say that the revenue hit might not be as bad as feared, but earnings per share (EPS) could still fall by 2–3%. However, Evercore ISI, led by five-star analyst Amit Daryanani, believes that many developers may stay in Apple’s ecosystem because of the trust and ease of its built-in billing system, even if they now have the option to avoid Apple’s fees.
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The decision is part of the ongoing legal battle between Apple and Epic Games. Though the ruling took effect on April 30, Evercore noted that App Store revenue actually rose 13% in May. Interestingly, Apple currently earns around $21 billion annually from the App Store, including roughly $7 billion in U.S. developer fees. While a complete loss of that $7 billion could lower EPS by 6%, analysts believe the real impact will be much lower.
In fact, J.P. Morgan and Morgan Stanley agree that the potential impact will likely be between 2% and 3%. This is based on a survey showing that about 28% of U.S. iPhone users might choose to avoid Apple’s payment system. If that behavior holds true, around $3.7 billion in revenue could be at risk, which would lower EPS by about $0.16 in a worst-case scenario. However, Apple pointed out that over 90% of App Store transactions in 2024 didn’t pay any commission fees, and CEO Tim Cook emphasized the success of developers using the platform.
Is Apple a Buy or Sell Right Now?
Overall, analysts have a Moderate Buy consensus rating on AAPL stock based on 16 Buys, nine Holds, and four Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $228.65 per share implies 12.4% upside potential.

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