NEW DELHI: Apple's iPhone
sales growth in India has for the first time raced past Greater China in the
three months to June, underlining the importance of the South Asian nation
where the smartphone maker has started aggressive pricing, discounts and
buybacks, a sea change from its earlier staid stand when the country wasn't
considered a prime market.
The Cupertino-based company's sales of iPhones in India grew 93% in the third quarter — albeit off a far lower base — faster than 87% growth in Greater China markets, comprising China, Hong Kong and Taiwan. The company's global phone sales rose 35% to 47.5 million units. "(In) India we grew at 93% and this is on top of the Greater China numbers that grew 87% during the quarter against a market of 5%," Apple's chief executive officer and director Tim Cook said during an earnings call Wednesday morning. "So, we did exceptionally well I think in any way that you look at it," he said.
While the base of growth in India has improved for Apple over the past year or so, the sales numbers of 0.5 million in the quarter are tiny compared to Greater China's volumes of about 14.5 million, industry insiders said. iPhone sales in China were 13.2 million in the just ended quarter, a growth of 86% on year. Still, the potential of the South Asian market, along with China, can't be undermined given the pace of smartphone growth and level of current penetration, especially when smartphone growth of many developed markets have nearly peaked, analysts say. In fact, Apple's shares slumped nearly 7% in after-hours trading after its revenue forecast for the fourth-quarter forecast fell short of estimates, with analysts worried about future growth with smartphone sales showing signs of plateauing.
iPhone sales growth in India were higher than 45% growth recorded in several countries, including Italy, Spain, the Netherlands and Turkey, Cook said, while sales more than doubled in Germany, Korea, Malaysia, and Vietnam. "Apple has been investing heavily in sales and distribution over the past four quarters. India is definitely a focus market and is clearly on their radar. They've geared up on the focus (India market) since two years now. Now, it's a market which has huge opportunity and can't be ignored," said Kiran Kumar, research manager at IDC India. India had approximately 116 million Internet-enabled smartphones by the end of last year. The number is expected to reach 369 million by the year 2018, as per KPMG/IAMAI.
Apple though has crossed 1.4 million iPhone sales as of June end, as per Counterpoint Research. At the same time, it clocked revenue of $1 billion in India market. Overall, Apple posted earnings of $10.7 billion on overall revenue of $49.6 billion, besides 59% growth in global iPhone revenue. Emerging markets, including India, grew 79% to almost $18 billion and represented 35% of Apple's total revenue. The company has been pitting the iPhone 4s at very aggressive price points and has introduced buybacks and upgrade offers for the new iPhone 6 and iPhone 6 Plus for the Indian market, where it's locked in a bruising battle with Samsung in the Rs 30,000-plus premium segment. The Korean smartphone maker leads this segment.
It has been rapidly pushing sales, offering discounts and increasing its retail presence with plans to create smaller-sized stores to go deeper into the Indian market. It even started midnight sales when it launched the iPhone 6 and iPhone 6 Plus in October last year. Apple launched Apple Music for a monthly $2 (Rs 120) in India, but $10 everywhere else.
Counterpoint analysts add that India performance is set to increase in the following quarters as the company has been able to offset the seasonality dip in the March and June quarters, owing to growth in emerging markets like India and China. The iPhone holds a huge aspirational value for users in the entrylevel to mid-level segments where home-grown players like Micromax, Intex, Lava, Karbonn and a plethora of Chinese players, led by Xiaomi, operate.
The Cupertino-based company's sales of iPhones in India grew 93% in the third quarter — albeit off a far lower base — faster than 87% growth in Greater China markets, comprising China, Hong Kong and Taiwan. The company's global phone sales rose 35% to 47.5 million units. "(In) India we grew at 93% and this is on top of the Greater China numbers that grew 87% during the quarter against a market of 5%," Apple's chief executive officer and director Tim Cook said during an earnings call Wednesday morning. "So, we did exceptionally well I think in any way that you look at it," he said.
While the base of growth in India has improved for Apple over the past year or so, the sales numbers of 0.5 million in the quarter are tiny compared to Greater China's volumes of about 14.5 million, industry insiders said. iPhone sales in China were 13.2 million in the just ended quarter, a growth of 86% on year. Still, the potential of the South Asian market, along with China, can't be undermined given the pace of smartphone growth and level of current penetration, especially when smartphone growth of many developed markets have nearly peaked, analysts say. In fact, Apple's shares slumped nearly 7% in after-hours trading after its revenue forecast for the fourth-quarter forecast fell short of estimates, with analysts worried about future growth with smartphone sales showing signs of plateauing.
iPhone sales growth in India were higher than 45% growth recorded in several countries, including Italy, Spain, the Netherlands and Turkey, Cook said, while sales more than doubled in Germany, Korea, Malaysia, and Vietnam. "Apple has been investing heavily in sales and distribution over the past four quarters. India is definitely a focus market and is clearly on their radar. They've geared up on the focus (India market) since two years now. Now, it's a market which has huge opportunity and can't be ignored," said Kiran Kumar, research manager at IDC India. India had approximately 116 million Internet-enabled smartphones by the end of last year. The number is expected to reach 369 million by the year 2018, as per KPMG/IAMAI.
Apple though has crossed 1.4 million iPhone sales as of June end, as per Counterpoint Research. At the same time, it clocked revenue of $1 billion in India market. Overall, Apple posted earnings of $10.7 billion on overall revenue of $49.6 billion, besides 59% growth in global iPhone revenue. Emerging markets, including India, grew 79% to almost $18 billion and represented 35% of Apple's total revenue. The company has been pitting the iPhone 4s at very aggressive price points and has introduced buybacks and upgrade offers for the new iPhone 6 and iPhone 6 Plus for the Indian market, where it's locked in a bruising battle with Samsung in the Rs 30,000-plus premium segment. The Korean smartphone maker leads this segment.
It has been rapidly pushing sales, offering discounts and increasing its retail presence with plans to create smaller-sized stores to go deeper into the Indian market. It even started midnight sales when it launched the iPhone 6 and iPhone 6 Plus in October last year. Apple launched Apple Music for a monthly $2 (Rs 120) in India, but $10 everywhere else.
Counterpoint analysts add that India performance is set to increase in the following quarters as the company has been able to offset the seasonality dip in the March and June quarters, owing to growth in emerging markets like India and China. The iPhone holds a huge aspirational value for users in the entrylevel to mid-level segments where home-grown players like Micromax, Intex, Lava, Karbonn and a plethora of Chinese players, led by Xiaomi, operate.
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