A French court has set September 17 as the date to hear the government’s case challenging contractual terms imposed by Apple (AAPL) regarding software sold on the App Store, according to a Reuters report.
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France’s finance ministry sued Apple, alleging that the company imposes abusive contract terms on developers selling their products through the App Store. Paris’ commercial court will judge the case.
Considering the outcomes of similar past cases, Apple is unlikely to face a significant fine if found guilty. However, the court could require Apple to change its App Store contract terms. (See Apple stock chart on TipRanks).
France Digitale, a leading startup lobby in France, has reportedly also joined the case, according to Reuters.
“We’re going to find ourselves in a ‘heads you lose, tails I win’ situation. Either the commercial court condemns Apple, and it will be unprecedented … or Apple gets away with it, and it will be proof that current laws don’t allow the regulation of a systemic platform like Apple,” Reuters quoted France Digitale CEO Nicolas Brien as saying.
The case could be subject to further hearings, and the date for the court’s ruling has not been set.
Bank of America analyst Wamsi Mohan recently reaffirmed a Hold rating with a price target of $160 on Apple stock. Mohan’s price target implies 19.67% upside potential.
The analyst notes that SensorTower data shows slowing global App Store revenue growth. For example, app revenue only increased 12% year-over-year in May 2021, down sharply from 40% growth in May 2020.
“Apple faces tough compares across most products starting in the December qtr (F1Q22). However, Apple faces tough compares much earlier in the App Store given lockdowns precipitated an immediate increase in App activity last year,” Mohan commented.
Consensus among analysts is a Moderate Buy based on 20 Buys, 5 Holds, and 2 Sells. The average Apple analyst price target of $157.92 implies 18.12% upside potential to current levels.
AAPL scores a “Perfect 10” on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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