a16z's latest research indicates that since February 2025, there has been a structural surge in the submission of new AI-driven applications, but the overall revenue and growth of paying users in the application ecosystem have not kept pace, showing a divergence pattern of "quantity increase, quality lag" in market prosperity.

According to data cited by a16z, the monthly submission of new applications on the iOS platform has jumped from about 30,000 to 50,000 to approximately 120,000, while new Chrome extensions surged from about 3,000 to over 20,000. The submission volume of Android applications has also rebounded from previous lows to about 100,000, with all three major platforms experiencing several-fold expansions on the supply side.

In contrast to the explosive supply side, user engagement and revenue in mature application categories have weakened: gaming app usage time has decreased by about 3%, with revenue down by about 15%; lifestyle app revenue has dropped by about 30%; and revenue from book reading apps has seen the largest decline, reaching about 40%.

Independent data also confirms the extreme concentration of revenue structure—according to Sensor Tower's "State of Mobile 2026" report, in 2025, the top 1% of applications captured 92.2% of in-app purchase revenue in the App Store and Google Play (approximately $154 billion), while the remaining 99% of applications shared only about $13.1 billion; during the same period, global in-app purchase revenue from application categories surpassed that of games for the first time, reaching about $85.6 billion compared to $81.8 billion.

a16z believes that the new revenue generated by a few leading AI applications is offset by declines in mature categories such as games, lifestyle, and books. The market is not experiencing a "collective prosperity of all AI applications," but rather growth is highly concentrated among a small number of winners, with the vast majority of newly submitted applications failing to convert into sustainable users and revenue.

From a market mechanism perspective, the limited resources for app store reviews and user attention mean that the exponential expansion on the supply side has marginalized many new applications that lack user acquisition channels and monetization capabilities; funding and user attention continue to concentrate on leading AI applications that already have network effects and distribution advantages, further increasing customer acquisition costs for latecomers and creating a "Matthew effect" where the strong get stronger.

Source: Public Information