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Apple (NASDAQ:AAPL) is testing an ai-powered advertising product for use within the App Store to boost its advertising business, Business Insider reported.
The product automatically decides where to place the ads. App Store and being tested with a small group of advertisers. It is similar to Google's (GOOG) (GOOGLE) Maximum performance and meta platforms (GOAL) Advantage+ and could lead to new ad placements on Apple, the media ai-app-store-ads-performance-max-2024-3″ target=”_blank” class=”paywall-full-content invisible”>sayingciting two people familiar with the matter.
Share rose 1.2% in midday trading on Monday.
Apple did not immediately respond to a request for comment from Searching Alpha.
At this point, it's unclear whether Apple could expand the ai-powered advertising product to other areas outside of the App Store, such as Maps, Apple TV+, or its stocks app. In 2022, Apple was reported to be looking at other areas such as Apple Maps, Apple TV+, and Apple Books to place ads in an effort to boost its revenue growth.
Apple does not break out revenue specifically related to advertising, but rather it is included in its Services segment. In its most recent quarter, Apple generated $23.1 billion in services-related revenue, hitting an all-time high for the Tim Cook-led company.
Despite service revenue growth, Apple's overall revenue has been stagnant lately. Sales in its most recent quarter grew just 2% year over year to $119.6 billion, ending a string of four consecutive quarterly sales declines.
