Tech giant Apple (AAPL) is taking direct control over ad sales within the Apple News app to boost its advertising business, according to Axios. This shift away from reliance on third-party vendors is expected to benefit both Apple and its publishing partners.
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By selling ads directly, Apple can better negotiate deals with advertisers, potentially leading to higher revenue for both the company and content publishers. Further, this approach will allow Apple to optimize ad placements and pricing strategies.
This shift in Apple’s advertising strategy aligns with its efforts to expand the Services business. The company is currently witnessing strong advertising demand in its search engine and App Store platforms. Further, Apple News, with its growing user base, offers a promising opportunity for the company to drive revenue growth.
Apple Reveals New Ad Formats and Revenue-Sharing Model
AAPL plans to introduce new ad formats within the Apple News feed, including premium sponsorships for high-profile events, banner ads, video ads, and carousel ads. Advertisers will also have the option to sponsor specific feeds within the app, allowing for targeted campaigns.
It should be noted that publishers will receive a 70% share of the revenue generated from ads sold by Apple within their articles. Also, the company will share revenue from ads displayed in the Apple News feed with publishers, based on factors such as content engagement.
Is AAPL Stock a Good Buy?
Turning to Wall Street, AAPL has a Moderate Buy consensus rating based on 24 Buys, eight Holds, and two Sells assigned in the last three months. At $245.06, the average Apple price target implies a 7.35% upside potential. Shares of the company have gained over 19% year-to-date.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
