Sensor Tower’s State of Mobile 2026 report confirms what had been building for years: the mobile app economy has permanently shifted. For the first decade of mobile, games made more money than everything else combined. Clash of Clans and Candy Crush built empires on freemium. King went public. Supercell sold for $10 billion. That changed in 2025.

Apps Overtake Games in Mobile Revenue

Line chart showing apps overtaking games in mobile IAP revenue in 2025, with apps at $85.6B and games at $81.8B, per Sensor Tower's State of Mobile 2026
Non-game applications now generate more in-app purchase revenue than games. Apps crossed $85.6 billion in 2025, up 21% year-over-year. Games managed $81.8 billion, barely moving from the year before.

Games peaked in 2021 and flatlined. Apps kept compounding. Subscriptions, which seemed like a novelty in 2018, became the dominant mobile monetization model for cloud storage, language learning, and now AI.

GenAI: The $3.5 Billion Growth Engine

Horizontal bar chart showing GenAI led mobile app revenue growth in 2025 with $3.5B added, more than any other category
Generative AI was the biggest contributor to consumer spending on mobile apps. The category added $3.5 billion in IAP revenue in 2025, more than Movies & TV ($2.2B) or Social Media ($2.1B). It went from near-zero in 2022 to the top growth category in three years.
Combined bar and line chart showing GenAI app downloads rising from 0.05B in 2021 to 1.45B in 2024, with revenue hitting $1.25B
GenAI apps went from 50 million downloads in 2021 to 1.45 billion in 2024. Revenue jumped from essentially nothing to $1.25 billion. ChatGPT alone accounts for 40% of the category’s consumer spend. This is just in-app purchases and does not count subscriptions billed outside the app store or enterprise contracts.

Who Actually Uses AI Apps

AI app users differ from the broader internet population.

Scatter plot showing GenAI user demographics cluster with Reddit and X (young, male-skewing), not Instagram or Pinterest
GenAI users cluster with Reddit and X. Young, male, tech-adjacent. They look nothing like Instagram (young women) or Pinterest (older women) or even Facebook (everyone’s parents). The AI audience is still a niche, even as GenAI app revenue scales.

The AI Advertising Playbook

This explains where AI companies advertise:

Horizontal bar chart showing AI companies over-index on LinkedIn (+45%) and under-index on Pinterest (-13%) and YouTube (-9%) for ad demographics
LinkedIn gets 45% more GenAI ad impressions than its share of the general population would suggest. Pinterest and YouTube get less. The AI advertising playbook is simple: find professionals, not consumers.

AI-Driven Retail Referral Traffic

AI tools are also sending consumers to retailers.

Stacked area chart showing GenAI referral traffic to major retailers growing from ~$5M to ~$51M between Oct 2024 and Dec 2025
Referral traffic from AI tools to major retailers grew roughly 7x between October 2024 and December 2025. People are asking ChatGPT what to buy, and then buying it. Amazon captures the largest share, but Walmart, Target, and Home Depot have all seen triple-digit percentage growth in AI-driven traffic. AI referrals still account for less than 1% of total retail traffic, but are growing fast.

YouTube’s Cross-Generational Dominance

Table showing YouTube is the #1 app across every age group in the US (18-24, 25-34, 35-44, 45+) per Sensor Tower
YouTube is the top app across every age demographic: 18-24, 25-34, 35-44, 45+. No other app has achieved this. TikTok appears for the youngest and oldest groups but vanishes in the middle. Instagram fades with age; Facebook rises with it.

Waymo’s Quiet Expansion

Line chart showing Waymo's autonomous ride-hailing penetration of Lyft and Uber users rising to ~4% and ~3% respectively by Q4 2025
Waymo accounts for about 4% of Lyft users and 3% of Uber users nationally, despite operating in only a handful of cities. In its active markets (San Francisco, Phoenix), market share is closer to 15%. The company has driven 127 million autonomous miles and tripled its ride volume to 15 million trips in 2025.

The revenue and usage data point to different distribution strategies: AI companies targeting professionals, YouTube serving every age group, and Waymo expanding city by city.