App Store Revenue & Installs: 2021 Records

The App Economy Continues to Expand in 2021

The global application marketplace is projected to achieve unprecedented financial milestones in 2021. A recent analysis of the worldwide app ecosystem conducted by Sensor Tower reveals that initial app installations reached 143.6 billion throughout the year. This represents a slight increase of 0.5 percentage points compared to the figures recorded in 2020.

Consumer Spending Reaches $133 Billion

However, consumer expenditure within applications experienced a significantly larger surge, climbing 19.7% year-over-year to a total of $133 billion. This figure encompasses spending on in-app purchases, premium applications, and subscription services available on both the Apple App Store and Google Play.

Growth Mirrors 2020 Trends

This rate of expansion closely parallels the growth observed in 2020, when consumer spending increased by 21% to reach $111.1 billion, as highlighted by Sensor Tower. The continuation of this growth trajectory is particularly noteworthy.

Impact of the COVID-19 Pandemic

The year 2020 witnessed widespread disruption due to the COVID-19 pandemic, compelling consumers to adopt remote work, online shopping, virtual social interactions, and online learning. These behavioral shifts profoundly influenced app usage and spending patterns during that period.

Global App Revenue in the First Half of 2020

Global app revenue surged to $50 billion during the first six months of 2020, largely attributable to the pandemic's impact on the mobile app landscape, as previously reported by TechCrunch.

Early Indicators of Sustained Trends

Initial indications suggested that the pandemic-induced shifts in consumer spending would persist beyond the government-imposed lockdowns of 2020, continuing to shape mobile trends in 2021. For instance, consumer spending on iPhone applications in the U.S. was anticipated to average $180 in 2021, an increase from $136 the previous year.

The actual figure reached $165, and consumer spending during the first half of 2021 already established new records, totaling $64.9 billion globally.

App Store and Google Play Revenue

Sensor Tower’s latest report indicates that the record $133 billion in global spending includes $85.1 billion generated through the App Store, a 17.7% year-over-year increase from the $72.3 billion spent in 2020.

Google Play accounted for $47.9 billion in consumer spending, representing a 23.5% increase from the $38.8 billion recorded in 2020. The App Store continues to generate approximately 1.8 times the revenue of Google Play, consistent with historical trends.

TikTok Leads Revenue Outside of Gaming

Excluding games, TikTok emerged as the highest-revenue-generating app globally in 2021, including its Chinese version, Douyin. The combined revenue of ByteDance’s short-form video app exceeded $2 billion during the first 11 months of the year and is projected to reach $2.3 billion by year-end.

This will bring its lifetime total to $3.8 billion.

TikTok's Performance on App Stores

While TikTok topped the App Store charts in terms of global spending, it ranked fourth on Google Play based on consumer expenditure. Google’s own Google One subscription service held the top position on Google Play and is expected to reach $1 billion in consumer spending by year-end, a 123% increase from $448.5 million in 2020.

App Downloads Begin to Stabilize

Global app downloads are showing signs of stabilization. Overall figures increased marginally by 0.5% year-over-year, from 142.9 billion in 2020 to 143.6 billion. This growth was primarily driven by an increase in Android app downloads on Google Play.

Installs on Google Play grew 2.6% year-over-year to reach 111.3 billion, up from 108.5 billion in 2020.

Decline in App Store Downloads

However, the App Store experienced a decline in new app installations, with downloads decreasing by 6.1% from 34.4 billion in 2020 to 32.3 billion this year, according to Sensor Tower’s estimates.

TikTok Remains Most Downloaded App

TikTok remained the most-downloaded app globally, with 745.9 million installations, despite a decrease from the 980.7 million installations recorded in 2020. Apple also confirmed that TikTok was the top U.S. download of the year on its Free iPhone Apps chart.

Facebook's Performance

On Google Play, Facebook led the charts with 500.9 million installs, demonstrating its ability to gain traction in emerging markets where Android is more prevalent. Across both app stores, Facebook will achieve 624.9 million installs in 2021, a 12% decrease year-over-year from 707.8 million in 2020.

Mobile Games Dominate Revenue

Mobile games continue to generate the largest share of global app revenue, as in previous years. In 2021, mobile game spending is projected to reach $89.6 billion across the App Store and Google Play, a 12.6% year-over-year increase from the $79.6 billion spent in 2020.

Shifting Revenue Distribution

However, the proportion of overall revenue attributed to gaming is decreasing. In 2019, games accounted for 74.1% of all app spending, which decreased to 71.7% in 2020. This year, they represent just 67.4% of all in-app spending.

This shift is due to the growth of subscription-based apps outside of gaming, particularly streaming and entertainment apps, which have benefited financially from the pandemic.

App Store and Google Play Gaming Revenue

On the App Store, games will account for $52.3 billion in consumer spending this year, up 9.9% from 2020. The gaming market on iOS is led by Tencent’s Honor of Kings, which generated $2.9 billion on iOS, a 16% increase from the $2.5 billion it earned last year.

On Google Play, the highest-grossing title remains Moon Active’s Coin Master, up 13% year-over-year to nearly $912 million. Overall, games on Google Play will generate $37.3 billion in global spending, a 16.6% year-over-year increase from $32 billion in 2020.

Game Installs Trends

Game installations, like overall mobile app installations, declined year-over-year on the App Store, decreasing from 10.1 billion in 2020 to 8.6 billion this year. PUBG Mobile, including the Chinese version Game of Peace, garnered the most downloads (47.5 million).

On Google Play, game installations grew 1.3% from 46.1 billion last year to 46.7 billion this year, with Garena Free Fire securing the most downloads (218.8 million).

Normalization and Continuing Trends

This year’s trends reflect a degree of normalization following the exceptional activity observed in 2020. However, certain trends have persisted, such as the diminishing proportion of consumer spending attributed to games and the consistent outperformance of Android over iOS in terms of downloads, while iOS maintains a lead in revenue.