Apple makes progress in India as iPhone sales rise 34% to record high in quarter

Apple Inc. had its strongest quarter yet for iPhone sales in India, a sign that the Cupertino, California-based company is finally making headway in the world’s fastest-growing smartphone market. Sales of iPhones in India rose to 2.3 million units in the fourth quarter, up 34% from a year earlier, according to market research firm Counterpoint.

China's Xiaomi and South Korea's Samsung Electronics led the way in terms of sales, selling 9.3 million and 7.2 million smartphones, respectively, in the quarter.

However, Apple appears to have more revenue than any of its rivals due to the high price of the iPhone, according to Counterpoint calculations, which estimate Apple's quarterly revenue at $2.09 billion, slightly ahead of Samsung, which had about $2 billion.

"This is a turning point for Apple in India," said Neil Shah, Mumbai-based partner and research head at Counterpoint Technology Market Research. "Indians are willing to spend money on premium phones during the pandemic because everyone's life revolves around their phones and there is nothing else to buy."

While Apple has become the world's most valuable company thanks to the popularity of its iPhone, it has struggled in India, a market of 1.3 billion people. Expensive iPhones are far beyond the reach of many local consumers, a situation exacerbated by high import duties on phones Apple makes abroad.

In 2018, Apple suffered the departure of several executives, declining sales, and its online discounting practices in India, which angered local retail partners and sparked protests. Apple sold 1.8 million iPhones throughout the year, lower than the sales in the most recent quarter. However, since then, the technology giant has made a big shift in strategy. It opened its own online store in India, simplified discounts, and began manufacturing iPhones locally. The company plans to open its own retail stores in multiple cities in the coming quarters.

The phone maker priced its base model iPhone 12 at less than 50,000 rupees ($668) during India’s recent October-December festive shopping and gift-giving season and offered cash back incentives and easy payment plans.

Apple remains a tough sell in India, where per capita income was less than $2,000 in 2020, according to the World Bank. In the most recent quarter, the average iPhone sold for $908 in India, compared with $278 for Samsung and $172 for Xiaomi, according to Counterpoint data.

While Apple's market share rose, it remained in the single digits above 5% during the quarter. Indians bought 44 million smartphones during the period.

Apple faces challenges beyond market prices in India. Apple's manufacturing partners Foxconn Technology Group and Wistron Corp. have suffered setbacks in India over worker treatment. In addition, India's antitrust regulator, the Competition Commission of India, has begun investigating app store fees.