How much does a mobile app make? Ads vs subscriptions

How much does a mobile app make? There's no honest average number, but there is a simple calculation. With ads, revenue equals the number of impressions divided by 1,000, multiplied by the eCPM (what 1,000 ad views earn you). With a subscription, it equals the number of subscribers multiplied by what you keep from each payment, after VAT and Apple's commission. So a free app makes money through its ads, its in-app purchases, or both.

The consequence is harsh: an ad earns a fraction of a cent per view, so you need a lot of very active users before it pays. A subscription earns euros per person, but only if the app delivers enough value for people to pay. This guide walks through both calculations with official sources, what moves the result, and why most apps make almost nothing. I publish my own iOS apps, including Solys and TradaZen on the App Store, both sold by subscription.

How much does a free mobile app make?

An app that's free to download can make money in four ways:

• Ads: the app shows ads, and an ad network like Google AdMob pays you a share of the revenue.
• In-app purchases: the app is free, but some features or content are paid for individually.
• Subscriptions (called "freemium" when part of the app stays free): full access is paid monthly or yearly.
• Free in service of something else: the app earns nothing directly, but supports a product or service sold elsewhere.

Many apps combine several models, for example ads for free users and a subscription that removes them. "Free" describes the download price, not the revenue model.

How much do ads make in a mobile app?

The math: impressions and eCPM

In AdMob, the key metric is called eCPM. Google defines it as an estimate of the revenue you receive for every 1,000 ad impressions, calculated like this: (total earnings ÷ impressions) × 1,000.

Google gives its own example: an ad that earned about $180 from 45,000 impressions has an eCPM of $4. Careful: that's a sample calculation from the AdMob help center, not a market average.

How much does one ad in an app make?

A single ad earns the eCPM divided by 1,000. With the $4 eCPM from Google's example, one view is worth $0.004, less than half a cent. That's why the question only makes sense at volume.

Let's apply that same eCPM to a small app, with assumptions picked purely for the exercise:

• 1,000 daily active users;
• 3 ads seen per user per day, so 3,000 impressions per day;
• about 90,000 impressions over a 30-day month.

Result: 90,000 ÷ 1,000 × $4 = about $360 in estimated revenue per month. If your real eCPM is half that, divide by two; if it's higher, multiply. The only way to know your eCPM is to measure it in your own app.

What makes eCPM vary?

In its article on eCPM fluctuations, Google explains that eCPM depends heavily on market and platform, and mentions differences between countries, seasonality, blocked ad categories and floor prices. On top of that comes the format:

• Banner, a rectangle pinned to the top or bottom of the screen;
• Interstitial, a full-screen ad shown at a natural break, for example between two levels;
• Rewarded video, which the user chooses to watch in exchange for an in-app bonus, something guideline 3.2.2 allows;
• Native ads, blended into the app's design.

The full list is in the AdMob help on ad formats.

On iOS there's one more constraint: showing targeted ads based on data collected from other companies' apps and websites counts as tracking in Apple's terms, and you must first ask the user for permission through App Tracking Transparency.

Ads pay in proportion to the time spent in the app. An app opened one minute a week will never fund much with ads, no matter how many downloads it has.

How much does a subscription make in an iOS app?

The math starts from the displayed price, and you have to subtract two things.

VAT. In France, the price shown on the App Store includes 20% VAT.

Apple's commission. It's 15% if you're enrolled in the Small Business Program, open to new developers and to those whose products didn't exceed $1 million in the previous calendar year, and 30% at the standard rate. For subscriptions, Apple states on its dedicated page that your share goes up to 85% once a subscriber has accumulated one year of paid service.

Example, with a price chosen purely for illustration: a monthly subscription at 4.49 euros is worth about 3.74 euros excluding VAT, and about 3.18 euros for you after a 15% commission. With 100 subscribers, that's about 318 euros a month. The full calculation, and the choice between subscription and one-time purchase, are in subscription or one-time purchase for an iOS app.

Good to know: Apple's commission applies to purchases made through the App Store. Ad revenue is paid by the ad network, under its own terms.

Ads or subscription: which makes more for a first app?

Go back to the two examples above, keeping in mind they rest on assumptions. You'd need about 1,000 daily active users for ads to earn roughly as much as 100 subscribers at 4.49 euros.

For a first app, that's often decisive: getting 1,000 people to open your app every day is very hard without an acquisition budget. Convincing 100 people that a tool is worth a few euros a month is often easier, as long as it solves a real, recurring problem.

Ads still make sense for:

• games and apps opened several times a day;
• apps people would never pay for but use a lot;
• a hybrid model, where the subscription removes the ads.

Subscriptions fit better for everyday utility tools: alarm clocks, fitness, learning, finance, productivity. That's the model of my apps, and the one I recommend by default to a beginner aiming for recurring revenue. The technical side is covered on the iOS in-app subscriptions page.

What makes an app's revenue vary wildly?

Two apps with the same number of downloads can have wildly different revenue.

The paid conversion rate. An onboarding that shows the value before asking for payment converts better than a paywall shown before the person understands what they're buying. The mistakes to avoid are in iOS paywall: 7 beginner mistakes.

Retention. An app used once and then forgotten earns a spike that drops off fast, with ads and subscriptions alike. An app that becomes part of a habit keeps earning.

Price and how well it matches perceived value. Too low, and it doesn't cover acquisition costs, from Apple Search Ads for example; too high without justification, and it shuts the door before the trial. You find the right price by testing.

Market size. A very broad problem has more people to convince; a specific niche often converts better, because the need there is sharper.

Why most apps make almost nothing

The vast majority of published apps never find their audience. It's almost never about code quality: it's distribution thought about too late. An excellent app that's invisible in App Store search earns the same as a mediocre one: nothing.

So revenue is prepared before the first screen is coded: the model, the price, and how the app will get found. The App Store ASO page explains how to work on your listing to show up in searches, and the article how much does an iOS app cost helps you estimate what the app needs to cover.

What actually improves your chances

• Solve a real, recurring problem, not an idea that runs out after one use.
• Pick the revenue model before coding, because it changes the app's structure.
• Polish the onboarding: conversion is decided there, even before the paywall.
• Work on your App Store listing from the first submission, then keep it alive with the promotional text.
• Measure, then adjust: price, trial length, paywall timing, ad frequency.
• Keep the first version small, as the iOS app MVP page explains.

Building an app that can make money

Choosing the model and setting the price is the first step of the iOS Kit; onboarding, paywall and subscriptions are already in its starter code. The full path to build a mobile app without starting from scratch with a revenue model from day one is summarized on the home page.

Nobody can promise you revenue, and I won't. What you can aim for is an app with a well-thought-out revenue model, then measurements to know what to improve next.

Frequently asked questions

How much can a mobile app make?

There's no honest average number, but there is a simple calculation. With ads, revenue equals the number of impressions divided by 1,000, multiplied by the eCPM, meaning what 1,000 ad views earn. With a subscription, it equals the number of subscribers multiplied by what you keep from each payment, after VAT and Apple's commission. The full calculation is in subscription or one-time purchase for an iOS app.

Does an app make money?

Yes, an app can make money, but most make almost nothing. A good app that's invisible in App Store search earns the same as a mediocre one: nothing. Revenue is prepared before the first screen is coded: the model, the price, and how the app will get found. Nobody can promise you revenue.

How do you make money with a mobile app?

In four ways: ads, where a network like Google AdMob pays you a share, in-app purchases, subscriptions, or a free app that supports a product or service sold elsewhere. Many apps combine several models, for example ads for free users and a subscription that removes them. "Free" describes the download price, not the revenue model.

Is building an app profitable?

Nobody can promise you an app will be profitable. Revenue varies wildly depending on paid conversion rate, retention, price and market size. For a first app, convincing people to pay is often less difficult than gathering enough active users for ads to pay off, as long as the app solves a real, recurring problem.

What is eCPM in AdMob?

According to Google, eCPM is an estimate of the revenue you receive for every 1,000 ad impressions, calculated like this: (total earnings ÷ impressions) × 1,000. In the AdMob help example, an ad that earned about $180 from 45,000 impressions has an eCPM of $4. It's a sample calculation, not a market average.

What commission does Apple take on a subscription?

Apple takes 15% if you're enrolled in the Small Business Program, and 30% at the standard rate. The program is open to new developers and to those whose products didn't exceed $1 million in the previous calendar year. For subscriptions, Apple states that your share goes up to 85% once a subscriber has accumulated one year of paid service.