Apple is reportedly losing more than $1 billion annually on its streaming service, Apple TV+, as it struggles to compete with industry giants like Netflix, Disney+, and Amazon Prime Video. While the company has invested heavily in original content, Apple TV+ has failed to gain significant market share, leading to major financial losses.

Apple TV+ Faces Tough Market Conditions

Apple launched Apple TV+ in 2019, promising high-quality, ad-free content with a strong focus on original productions. Over the years, the platform has produced critically acclaimed shows such as The Morning Show, Severance, and Ted Lasso, as well as award-winning movies like CODA, which won an Oscar for Best Picture in 2022.

Despite these successes, Apple TV+ has only around 45 million subscribers, far fewer than competitors like Netflix, which has over 230 million subscribers, and Disney+ with nearly 150 million. Reports suggest that Apple TV+ holds less than 1% of the global streaming market share, compared to Netflix’s 8.2%.

Heavy Spending, But Limited Subscriber Growth

Apple initially invested around $5 billion per year in original content to establish itself in the streaming industry. However, in 2024, it reportedly reduced this budget to $4.5 billion, likely due to lower-than-expected growth and rising losses.

One of the key challenges for Apple TV+ is subscriber retention. Many viewers sign up for free trials or short-term subscriptions to watch specific shows and then cancel their plans. Unlike Netflix, which offers an extensive content library, Apple TV+ has a limited selection, which makes it harder to keep users engaged long-term.

Can Apple Afford to Lose Money on Streaming?

Despite these losses, Apple TV+ is part of Apple’s broader Services division, which includes Apple Music, Apple Arcade, iCloud, and Apple Pay. This division remains highly profitable, generating billions of dollars for the company.

Some analysts believe that Apple is playing the long game with Apple TV+, using it to strengthen its ecosystem rather than compete directly with streaming giants. Apple could afford to subsidize losses for years while growing its content catalog and subscriber base.

Future of Apple TV+

To turn things around, Apple may need to expand its content library, improve marketing strategies, or bundle Apple TV+ with other services to make it more attractive. Some reports also suggest that Apple could acquire an existing media company to boost its content offerings.

For now, Apple TV+ continues to struggle in the highly competitive streaming industry, but its parent company has the financial strength to keep investing in the platform. Whether it can eventually compete with giants like Netflix and Disney+ remains to be seen.