AAPL Joins GOOGL’s Antitrust Trial to Defend its Billion-Dollar Search Deal – TipRanks.com

Apple (AAPL) has taken a bold step by requesting to participate in the U.S. Department of Justice’s antitrust trial against Google (GOOGL), signaling that Google cannot adequately defend its revenue-sharing agreements with the company. Apple and Google have a revenue-sharing agreement that makes Google the default search engine on Apple’s Safari browser—a deal that brought Apple an estimated $20 billion in 2022 alone.

GOOGL’s revenue-sharing agreements involve the company sharing a portion of its ad revenue with developers who set Google as the default search engine.

AAPL Plans to Call Witnesses in the Antitrust Trial

In court filings cited by Reuters, Apple stated that it has no intention of developing its own search engine to rival Google, regardless of the trial’s outcome. Instead, Apple plans to call witnesses to testify in the trial scheduled for April, indicating its vested interest in preserving the agreement.

Apple stated, “Google can no longer adequately represent Apple’s interests: Google must now defend against a broad effort to break up its business units.”

DOJ’s Case Against GOOGL

The antitrust case is a landmark effort by the U.S. Department of Justice to address Google’s alleged monopolistic practices. Prosecutors have argued that to restore competition in online search, drastic measures may be required, including breaking up Google’s business units, such as its Chrome browser and Android operating system.

Google, meanwhile, has proposed easing its default agreements with browser developers, device manufacturers, and wireless carriers, but it has stopped short of ending its ad revenue-sharing deals.

Is Apple a Buy, Sell, or Hold?

Analysts remain cautiously optimistic about AAPL stock, with a Moderate Buy consensus rating based on 19 Buys, eight Holds, and two Sells. Over the past year, AAPL has increased by more than 30%, and the average AAPL price target of $244.39 implies a downside potential of 5.4% from current levels.

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