According to a report by CNBC, Google will be paying Apple a reported $3 billion to remain the default search engine on iPhone and other iOS devices.
“Court documents indicate that Google paid Apple $1B in 2014, and we estimate that total Google payments to Apple in FY 17 may approach $3B,” Bernstein analyst A.M. Sacconaghi Jr. said. “Given that Google payments are nearly all profit for Apple, Google alone may account for 5% of Apple’s total operating profits this year, and may account for 25% of total company OP growth over the last two years.”
The deal is equally as sweet for Google. Sacconaghi says that Apple’s iOS devices contribute about 50 percent to Google’s mobile search revenue. That’s too much money for Google to leave on the table.