The news: Generative AI (genAI) apps like OpenAI’s ChatGPT and Anthropic’s Claude drove a massive 200% increase in consumer spending on AI mobile apps, reaching $1.1 billion in 2024, per Sensor Tower’s State of Mobile report. 

The rise of genAI apps highlights a shift in AI adoption and mobile preferences, revealing revenue potential despite the availability of free on-device options like Apple Intelligence and Google Gemini. This indicates a consumer preference for custom AI tools over default options.

GenAI’s mobile moment: AI tools on smartphones and tablets broke into the top 10 app spending categories for the first time.

• Consumers are finding increased value in spending on AI apps, which could lead to an increase in subscriptions and in-app purchases in the segment. 
• The genAI mobile app revenue surge is a result of increased competition and AI’s move from browsers to apps.

Zooming out: Overall, in-app spending grew 13% YoY to $150 billion globally, with non-gaming apps outpacing gaming apps—25% versus 4%, respectively.

• Social media ($11.7 billion) and streaming ($11.9 billion) led all mobile app revenues. Each category was driven by contrasting profit models—creator tipping and commissions for social media, and subscriptions for streaming.
• Mobile phone usage rose 5.8% YoY to 4.2 trillion hours worldwide, with notable growth in downloads for food and drink apps, which was up 8.5% YoY, and finance apps,  up 8% YoY. This indicates a market shift from entertainment and gaming to basic necessities.

Our take: With genAI transcending chatbots and becoming mission-critical tools thanks to AI agents, there’s an opportunity for AI-powered apps to take over other app categories. 

App segments that could benefit from AI agent makeovers include banking, business productivity, search, and even instant messaging.

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