Apple Inc. shares rose in after-hours trading following a U.S. court decision that left intact its highly profitable search deal with Google — an agreement estimated to bring in around $20 billion annually for the iPhone maker.
U.S. District Judge Amit Mehta, ruling in a major antitrust case, prohibited Google from signing exclusive contracts that block rivals in the internet search market. However, he allowed arrangements where Google pays to be set as the default search engine in browsers, including Apple’s Safari.
“Google is permitted to compensate browser developers, like Apple,” Mehta wrote. Still, he outlined conditions: partner companies must give visibility to competing search engines, provide alternative options across operating systems or in private browsing, and allow users to change their default search provider at least once a year.
Apple prioritizes Google by positioning it as the default search option in Safari across both desktop and mobile devices.
Mehta cautioned that eliminating Google’s payments altogether could disrupt the market. “Cutting off payments from Google almost certainly will impose substantial — in some cases, crippling — downstream harms to distribution partners, related markets, and consumers,” he noted, saying this weighed against an outright ban.
Currently, Safari defaults to Google search on Apple devices, though users can switch to alternatives such as Microsoft Bing or DuckDuckGo. Apple also introduced the option to choose a separate default for private browsing in iOS two years ago.
Following the ruling, Apple’s stock jumped as much as 4.3% to $239.50 in late trading, trimming this year’s earlier 8.3% decline. Alphabet, Google’s parent company, also saw gains of up to 8.7%.
The Apple-Google search agreement was a central issue in the Justice Department’s historic antitrust challenge against Google. Tuesday’s ruling not only preserved that partnership but also allowed Google to retain ownership of its widely used Chrome browser.
Judge Mehta had previously found Google guilty of illegally monopolizing search and search advertising markets. His latest ruling follows an April hearing focused on remedies.