Apple has boasted a staggering 1.5 billion subscribers for its services portfolio, up from a billion last January. However, the tech giant's latest quarterly report revealed that its services division fell short of Wall Street’s expectations.

The revenue shortfall in this segment was mainly attributed to a slowdown in mobile gaming and changes to the App Store business model in certain countries, including the U.S., where Apple is under court order to allow app developers to process payments outside its platform. While Apple didn’t specify the exact impact on App Store revenues, it noted that the Supreme Court will have the final say.

Despite these issues, other segments like Apple Ads and Apple TV showed strong performance, setting June quarter records. The company highlighted double-digit growth in emerging markets for both transacting and paid accounts within its services business.

Apple remains optimistic about future growth potential, with new features such as the Creator Studio subscriptions and bill-splitting options in Apple Cash set to deepen customer engagement. Additionally, the launch of the Apple Upgrade program this week might drive more users towards purchasing an iPhone or other Apple devices, thereby boosting services revenue.