Apple Bets On Emerging Markets With India At The Forefront

When Apple Inc. surprised investors this week by increasing iPhone sales despite a slump in the global smartphone market, CEO Tim Cook attributed the increase to emerging markets such as India, where the company is luring away Android phone users.

Apple said iPhone sales increased 1.5% to $51.3 billion in the fiscal second quarter, despite global smartphone shipments falling 13% from January to March, according to Canalys data, which showed Apple gaining market share from Android phones.

Apple claimed to have broken sales records in several countries throughout South Asia, Latin America, and the Middle East.

"We're putting efforts in a number of these markets and really see, particularly given our low share and the dynamics of the demographics, a great opportunity for us in those markets," Cook said on a conference call with investors.

Apple's primary focus appears to be India. The company recently opened its first two retail stores in the country, in Mumbai and Delhi, and while Apple does not disclose revenue for the country, Cook told investors that it set a quarterly record and that year-over-year percentage growth was in the high double digits.

"There are a lot of people coming into the middle class, and I really feel that India is at a tipping point, and it's great to be there," Cook said during the conference call.

According to research firm Counterpoint, Apple was the second largest revenue generating brand in India in 2022, trailing only Samsung, with 18% of the total value of smartphone shipments.

For Apple, selling an iPhone in an emerging market represents more than just the sale of a single device; it represents the opportunity to gradually hook consumers on Apple devices and services. Customers who begin with an iPhone may later upgrade to an Apple Watch or AirPods, or they may sign up for subscription services.