Morgan Stanley Analyst Says Apple TV+ Will Be $9 Billion USD Business by 2025

According to Morgan Stanley analyst Katy Huberty, Apple TV+ will be a $9 billion-a-year business by 2025.

And that’s even if many Apple device owners don’t pay anything for Apple+ — at least not at first, as the company is set to offer a year of TV+ for free to anyone who buys an iPhone, Apple TV or Mac device — and Apple’s TV content costs continue to rise.

“With an attractive price point at $4.99/month, and wide initial distribution to the Apple installed base via the bundled free year offer, we estimate Apple TV+ can become a $9B revenue business with 136M paid subscribers by FY25, assuming just 1 in every 10 Apple user pays for the Service by FY25,” Huberty wrote.

That forecast of 136 million subscribers worldwide by 2025 as a base case (Huberty’s projections range from 68 million to 175 million paid users) helped send shares in Apple to a new all-time high of $243.18 USD on Wednesday. The company earlier said it didn’t expect launch costs for Apple+ to have a “material impact on our financial results.”

Huberty agrees, stating that she expects Apple TV+ users eventually becoming paying customers will offset to the costs of content and operating expenses.

“For Apple TV+ to have a more material impact to our near term estimates, we’d have to assume 1) Apple TV+ production costs are significantly higher at the launch of the service, and/or 2) more users redeem the Apple 12-month free offer with the purchase of a device,” Huberty wrote.



Apple TV+’s launch comes amid a push by the Cupertino company to double down on its services business, which includes subscription-based products like Apple Music and iCloud. “With a growing list of catalysts, including accelerating Services growth and multiple expansion ahead of the 5G iPhone launch, and an attractive 8 percent total dividend + buyback yield, we continue to view Apple as our top pick into 2020,” Huberty added.

When it launches, Apple TV+ will feature an offering of original TV series and, eventually, films. These initial offerings include the sci-fi series “See” with Jason Mamoa and the TV news drama “The Morning Show” starring Reese Witherspoon and Jennifer Aniston.

Apple TV+ launches on November 1st for $5.99 CAD per month for up to 6 people for those who use Family Sharing. Apple is also running a limited-time promotion to get a free year of service if you buy a new iPhone, iPad, Mac, or Apple TV.