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There have been predictions for years that China would eventually be a larger market for Apple than the USA. The weak Chinese economy means that it hasn’t yet happened in hardware, but the latest App Annie data says that it’s already got there on the software side.

The highlight of this report is certainly China overtaking the U.S to become the largest market in the world for iOS App Store revenue — earning over $1.7 billion in Q3 2016. We predicted in Q1 that China’s rapid iOS revenue growth would drive it right past the U.S well before year’s end — China is now leading the U.S by over 15%.

The rapid growth in Chinese spending – a 500% increase in two years – is in line with earlier predictions. The stats also illustrate the importance of games in driving App Store sales …

While games account for only 25% of all apps, they generate 75% of all revenue.

App Annie highlighted the worldwide success of Pokémon Go, reaching $600M in revenue in well under 100 days. Candy Crush, in contrast, took more than twice as long to hit the same milestone. It continues to be the most-downloaded game on the App Store, ahead of Facebook, WhatsApp and Facebook Messenger.

The dominance of games looks set to change over time, however. In China, games are only the second fastest-growing category, while video streaming apps like iQIYI, Tencent Video, and Youku led the way.

Apple’s links with China continue to expand, with not just one but two R&D centers in the works.

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