Google's Antitrust Loss Could Put Billions At Risk For Apple

Google has suffered a staggering blow to its search and advertising business as District of Columbia Judge Amit Mehta ruled in favor of the Department of Justice in its antitrust suit against the tech giant.

While Apple doesn’t reveal exactly how much it makes from the Google deal, court documents pegged the number at an estimated $20 billion in 2022, double what Google paid in 2020.

It may cost Apple big-time, too, Yahoo Finance technology editor Daniel Howley reported.

The ruling could force Google to make dramatic changes to its largest business, but it could also force the company to cancel a long-term revenue-sharing agreement with Apple that requires the iPhone maker to use Google as the default search engine across its various devices.

The deal, called an Information Services Agreement, has been in place since 2002 and has been adjusted over the years as new technologies, such as the iPhone, have been introduced.

The gist of the deal is that Apple uses Google as its default search engine for its Safari browser, Spotlight Search, and Siri.

In return, Google pays Apple 36% of the search revenue generated on Apple devices using Google’s services. While Apple doesn’t reveal exactly how much it makes from the deal, court documents pegged the number at an estimated $20 billion in 2022, double what Google paid in 2020.

The revenue from Google and Apple’s agreement is likely realized under Apple’s Services business segment, which is where it lists third-party advertising licensing agreements.

In 2022, Apple saw $78.1 billion in Services revenue. If the $20 billion estimate is accurate, that means the deal accounted for roughly 25% of Apple’s Services revenue for the year.