Apple
's big bet on India is starting to pay dividends as the company's
iPhone
sales in the country surpassed those in any individual
European Union
country in the year 2023. Apple's iPhone revenue in India rose 42% YoY in 2023 to $8.7B, as per a
Morgan Stanley
note.
iPhone sales in India outshine the European Union
Driven by strong consumer demand for premium devices, iPhone revenue in India jumped 42% year-over-year to $8.7 billion last year.
iPhone shipments to India also grew 39% to 9.2 million units, making India the fifth-largest smartphone market for Apple. This makes India a larger iPhone market for Apple than individual European Union countries like Germany or France.
"India represented 4% of iPhone shipments and revenue in 2023, up from just 1% five years ago. This compares to a 20% share in China, which declined slightly year-over-year," the Morgan Stanley report stated.
Indian consumers crave more storage
Underpinning robust iPhone growth in India is rising consumer appetite for pricier, high-capacity devices. The average iPhone sold in India last year had around 260 GB of storage, a 26% increase from 2021. India's iPhone average selling price also rose 2% to $940. The
iPhone 13
, 14 series, and 15 were the top sellers, accounting for 86% of sales.
Old iPhone models drove maximum sales for Apple
Market research firm IDC's recent data reveals key insights into the models driving iPhone growth in India. The IDC report shows that the iPhone 13, iPhone 14,
iPhone 14
Plus, iPhone 14 Pro, and
iPhone 15
accounted for a substantial 86% of total iPhone sales in India in 2023.
While Indian consumers are buying premium devices, Apple's strategy of also selling older generation models at reduced prices is working well. This has allowed Apple to capture a greater slice of the value-focused Indian smartphone market while driving up overall iPhone shipments.
As per IDC, by catering to various price tiers beyond just the latest flagships, Apple has struck the right chord with Indian buyers. This segment-based approach has been vital to Apple registering a 39% year-on-year growth in iPhone volumes in the country.
Big India bets paying off for Apple
With China's iPhone growth stagnating amidst supply issues and market saturation, India is rising up the ranks for Apple. Propelling this growth is the appetite for premium devices instead of the latest models. This allowed Apple to capitalise on consumer demand in a price-sensitive market like India.
"If India continues its trajectory while China stays flat, India could overtake China to become Apple's largest iPhone market by 2027," Morgan Stanley analysts project.
In recent years, Apple has been increasing its investments in India, including opening its first retail stores last year. Manufacturing of iPhones in India has also been steadily rising to meet demand.
Morgan Stanley forecasts that Apple's India revenue will touch $40 billion by 2032. For a company facing market saturation and supply chain constraints in China, the growth in India comes as a boon.
Last year, Apple's CEO, Tim Cook, expressed his optimism about India during an earnings call, saying, "I'm even more bullish now, hopefully on the other side of it." Then, earlier this month, in the earnings call of Q4 2023, where Apple registered record iPhone revenue for the quarter and an all-time record for services, Cook highlighted India's importance, stating, "India reported strong double digits in revenue terms in the December quarter and hit a quarter revenue record."
As the second-largest smartphone market globally, India offers Apple a 1.4 billion consumer base that is just starting to trade up to pricier devices. With continued focus on addressing local demand, Apple seems poised for long-term gains in the Indian market.
For now, all eyes are on India as it emerges as a critical growth engine for Apple's iconic iPhone even as sales decline in China. The iPhone maker’s early mover advantage and understanding of Indian consumer preferences have set the stage for Apple to potentially make India its biggest iPhone market within a few years.
