Google Play Had a Profit of $8.5 Billion in 2019 With Margins of 62 Percent

According to court filings unsealed this week, Google Play earned a profit of $8.5 billion on revenues of $11.2 billion in 2019. Even more incredibly, the mobile app store had an operating margin of 62 percent that year. (The operating income was $7 billion.)

Right. This means that Google could very easily afford to charge developers a lot less than it does and still be wildly and even unfairly successful. And just imagine how heady the figures are for Apple’s App Store, which is even more successful.

The disclosure came as part of one of the many antitrust lawsuits that Google now faces for its abusive business practices in the mobile app store market. The US attorneys generals behind this particular suit argue that Google generates huge profits by “arbitrarily” charging developers up to 30 percent for doing little more than hosting their apps. And these numbers help confirm that belief.

Google, of course, disagrees.

“The data are being used to mischaracterize our business in a meritless lawsuit,” Google told Reuters.

This is the first time that Google Play’s profits, revenues, and margins have ever been revealed: Alphabet, Google’s parent company, hides those figures inside of a broader business category in its quarterly financial results.

And the disclosure comes amidst a new round of criticism of the online giant’s app store. As part of a separate lawsuit, Fortnite maker Epic Games disclosed that Google secretly struck anticompetitive deals with and/or threatened rival app and game makers like Riot Games to prevent them from bypassing its Play Store, as Epic had done. And internal Google documents show that the firm feared losing over $1 billion in annual profits because Epic bypassed the store with Fortnite.

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Conversation 10 comments

  • nbplopes

    29 August, 2021 - 3:59 pm

    <p>Imagine Apple. These companies policies around their mobile OSs in effect hold ransom internet users, third party companies customers. There is no miracle here … extortion.</p><p><br></p><p>So much so for Net Neutrality of both Apple and Google than create a Non Neutral Network on top.</p>

    • bats

      30 August, 2021 - 10:19 am

      <p>LOL….speaking about that, net neutrality, I thought prices were so suppose to skyrocket, across the board, for the consumers!!! (LOL). I remember, every single tech blogger/vlogger was so passionate about this topic and predict DOOM and GLOOM over this. They even went as far to insult and vilify Ajit Pai over this. This was I keep saying that tech bloggers/vloggers have no clue when it comes to this stuff. Net Neutrality may fall within the relm of technology, but it also falls into the financial, economic, and social sectors, which tech journalist/bloggers/vloggers have absolutely ZERO clue. That’s because they don’t live in the "real" world, where people produce things and not just consume them. </p>

      • nbplopes

        30 August, 2021 - 11:01 am

        <p>Net Neutrality passed in 2015. The bill that would allow ISPs to offer tiered lanes per digital service kind or device as failed to pass. For instance they would be able to “IF iOS Slow lane unless Apple payed for faster lanes”.</p>

    • bettyblue

      30 August, 2021 - 11:49 am

      <p>"These companies policies around their mobile OSs in effect hold ransom internet users, third party companies customers"</p><p><br></p><p>As an iOS user exactly how I am my being impacted? What is Apple doing to "hold ransom internet users"?</p>

  • red.radar

    Premium Member
    29 August, 2021 - 8:15 pm

    <p>The problem with the unchecked anti-competitive behavior is it normalizes this level of financial performance. Other companies are judged against these types of Gross Margins and it causes a lot of other problems at other companies. </p><p><br></p><p>It used to be the Great was 30%. Shareholders are demanding more and its causing problems at other companies. </p>

  • ringofvoid

    29 August, 2021 - 10:02 pm

    <p>I foresee a flat fee for hosting apps &amp; the resulting downloads rather than the current 30% cut of future in-app purchases. Apple &amp; Google are currently raking in the cash from situating themselves as the exclusive payment processor &amp; this status quo cannot last.</p>

  • lezmaka

    Premium Member
    30 August, 2021 - 10:34 am

    <p>Does that revenue/profit split include all the money Google pays to companies like Samsung to keep them from opening competing stores?</p>

  • bettyblue

    30 August, 2021 - 11:48 am

    <p>"This means that Google could very easily afford to charge developers a lot less than it does and still be wildly and even unfairly successful."</p><p><br></p><p>So we want the government to determine how much success you can have in a free market for non-necessary products and services "niceties"??? Ok comrade, sign me up?</p><p><br></p><p>There is NOTHING Google or Apple makes that I have to have. In fact I use ZERO Google products outside of viewing videos on YouTube, via a browser (not their app) and with a fake email account and multiple ad blockers to not see ads.</p><p><br></p><p>Google can charge developers as much as they want. We it gets out of control those developers will leave and their platform will suffer.</p><p><br></p><p> </p><p><br></p>

  • melinau

    Premium Member
    31 August, 2021 - 12:10 pm

    <p>Interesting that several people are in favour of Google &amp; others gouging &amp; ripping-off the Public. Of course, it’s quite possible that consumers or users don’t <strong>NEED </strong>to use Android or Apple’s variously walled gardens, but most people using such ‘phones probably do have at least one or two Apps from them.</p><p><br></p><p>For Developers it’s obviously much worse. If I were to make a new App, I’d have effectively no choice but to try and sell it through Play store or App Store &amp; then the big guys would extract their fees. Naturally I <strong>could </strong>forgo using their services, but then I’d probably sell nothing at all…</p><p><br></p><p><span style="color: rgb(0, 0, 0);">Who determines, in a Free Society, what is a necessity or luxury? </span>This isn’t an issue of Capitalism vs Communism (Comrade) but simply one of what is fair. </p><p><br></p>

    • bettyblue

      31 August, 2021 - 2:13 pm

      <p>If you made an app would it be free or .99 cents, which is probably most apps in either store. </p><p><br></p><p>Lets say you made an app for both Google’s and Apples platforms…..yes their platforms that they have built and maintain and provide support for you and other developers. So you build this app for both stores, and sell for .99cents. Now lets say its crazy popular and you sell a million copies of that app. </p><p><br></p><p>You get 700k and Google/Apple get 300k for…………..providing the platform (Android/iOS), the development tools and all the API’s, the research and development of both the OS and development tools, the store for you to put it on, the servers from which those 1 million customers will download it from, the bandwidth that they will use to download it from, the datacenters that house those servers, the complete payment processing cycle for 1 million transactions and the security for all of that. You just write the app, sumbit it and collect 700k.</p><p><br></p><p>How is the public being ripped off? Is your app not worth .99 cents? Is it the easy and convient and mostly safe app store they use? Is it the trusted payment processing system they use to buy that .99 cent app?</p><p><br></p><p>Again this is not a live saving EpiPen that they are charging $800 for. These are niceties, smartphone apps, with the vast majority of them being from or less than $1.</p>


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