Apple TV Plus Had ‘Immaterial’ Revenue in Launch Quarter Amid One-Year Free Deal

Apple reported record-setting sales of nearly $92 billion for the three months that ended 2019 — but Apple TV Plus, the flashy new subscription-video service it bowed last fall, wasn’t part of the tech giant’s growth story.

Apple TV Plus revenue “was immaterial to our results” for the period, CFO Luca Maestri told analysts on the company’s earnings.

The exec’s comments are not surprising: Apple is giving away Apple TV Plus free for one year to customers who buy a new iPhone, iPad, Apple TV, Mac or iPod touch. According to estimates by Ampere Analysis, the “vast majority” of Apple TV Plus’s roughly 33.6 million U.S. users as of the end of the year were not paying subscribers.

Over time, Maestri said, Apple expects that over time, Apple TV Plus will become a bigger part of the company’s growing services business, which increased 17% year-over-year in the quarter ended Dec. 28, Maestri added. Apple TV Plus is priced regularly at $4.99 per month (after a free seven-day trial).

Apple’s initial “give-it-away” approach in trying to vie for eyeballs against the likes of Netflix, Disney, Amazon and HBO in the streaming wars highlights its interest in using Apple TV Plus as a carrot to drive sales of its hardware. On the call Tuesday, execs did not provide commentary about the extent to which Apple TV Plus may have spurred device sales. During the holiday quarter, iPhone sales rose 8% after several quarters of revenue declines.

CEO Tim Cook said on the earnings call that Apple is primarily measuring the success of Apple TV Plus based on number of subscribers. But he didn’t shed any light on how many subs have signed up for the service at this point, except to claim that “Apple TV Plus is off to a rousing start.”

Cook added that “the product itself is about storytelling… We think if we do that well, there will be some number of [shows] that are critically acclaimed.”

Asked whether Apple has an advertising opportunity with Apple TV Plus, Cook responded, “we feel strongly what that customer wants is an ad-free product,” echoing Netflix’s often-reiterated position that it is still not interested in selling ads.

Apple TV Plus, launched Nov. 1 in 100 countries, has more than a dozen original TV series and movies. Those include “The Morning Show” starring Jennifer Aniston, Reese Witherspoon and Steve Carell; M. Night Shyamalan’s thriller “Servant”; Ronald D. Moore’s alt-history space-race series “For All Mankind”; “Oprah’s Book Club”; and Kumail Nanjiani and Emily V. Gordon’s docu-series “Little America.”

More TV

  • Emmy FYC Season to Kick Off

    Emmy FYC Season to Kick Off With a Michael Sheen/Lizzy Caplan Reunion

    Brace yourself — Emmy campaign season gets underway next weekend, starting with a unique For Your Consideration double bill for Fox’s “Prodigal Son” and Hulu’s “Castle Rock” on Saturday, Feb. 29. Warner Bros. TV is behind the event, which will pair “Prodigal Son” star Michael Sheen and “Castle Rock” star Lizzy Caplan on the same [...]

  • Democratic Presidential Candidates, former New York

    Ninth Democratic Debate Draws Record 19.7 Million Viewers

    The ninth Democratic debate of this election cycle, which saw candidates tear into former New York City Mayor Mike Bloomberg in his first appearance, was the most-watched ever, drawing just under 20 million total viewers. Wednesday night’s feisty affair, which aired across MSNBC and NBC News, comfortably beat the previous record of 18 million viewers [...]

  • steven universe

    'Steven Universe' Sets Final 10 Episodes on Cartoon Network

    The “Steven Universe” saga appears to be coming to a conclusion. The first of the final 10 episodes of the Cartoon Network original animated series will debut March 6 at 7 p.m., the cabler announced Thursday. The run will end March 27 with a four-part series finale. Though the next batch of episodes is set [...]

  • In this image released, general views

    Jennifer Khoury, Adam Miller Elevated in New Roles at Comcast

    Two top communications executives at Comcast Corp., Jennifer Khoury and Adam Miller, were given broader roles at the company that will make them the top architects of the entertainment giant’s strategy in how it portrays itself to the public and other constituencies. Khoury, a veteran of public relations strategy at Comcast’s cable operations, was named [...]


    'So You Think You Can Dance' Renewed for Season 17 at Fox

    “So You Think You Can Dance” has been renewed for a 17th season at Fox. Bailey Munoz was named the winner of the most recent season of the dance competition series. Munoz, a 19 year old break dancer, won $250,000, a cover spot on “Dance Spirit” magazine, and the title of America’s Favorite Dancer. Auditions [...]

More From Our Brands

Access exclusive content