Apple reported strong quarterly results ahead of the iPhone X launch on Friday, with iPhone sales at 46.7 million unit, up from 45.5 million in the year-ago quarter. The company posted quarterly revenue of $52.6 billion (roughly Rs. 3,39,595 crores), an increase of 12 percent year-over-year (YoY), with international sales accounting for 62 percent of the revenue. India revenue doubled year-over-year, though the exact number remains unknown as Apple does not break down revenue for the Indian market.
“Revenue from emerging markets outside of greater China was up 40 percent, with great momentum in India, where revenue doubled year over year,” CEO Tim Cook said in his opening remarks during the earnings call. The country also witnessed “double digit” growth in iPhone sales as the iPhone SE manufacturing gained momentum.
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“We were very pleased to see double digit iPhone growth in many emerging markets including mainland China, the Middle East, Central and Eastern Europe, India, and Mexico,” CFO Luca Maestri revealed.
iPad sales were similarly up in India and elsewhere.
“It was great to see iPad unit and revenue growth in all of our geographic segments and particularly strong results in emerging markets, including greater China, where iPad units sales were up 25 percent year-over-year and India, which grew 39 percent,” Maestri said.
Later, replying to a question by Citigroup Global Markets’ Jim Suva, Tim Cook said Apple is making “good progress” in India and “gaining understanding of the market”, but admitted that the company has “a long way to go” in the country.
Suva asked: “Based upon market analysis, it looks like Apple’s still just a relatively small sliver of the pie [in India]. So Tim, what would it take be even more successful in India? Is it a manufacturing footprint there? Is it partners? Is it more physical stores? Is it lower price points? Is it the bandwidth that has now caught up to many other countries, or how should we think about that?”
“In terms of India, many of the things that you mentioned are correct,” Cook replied. “Growing a market like India is a result of all of those things and doing them all well. And so it’s analogous to the many years that we put into China. It’s building stores. It’s building channels. It’s building markets. It’s building the developer ecosystem. It’s having the right product lineup for the market.”
“And I feel like we’re making good progress there and are gaining understanding of the market, but we still have a long way to go, which I sort of see as an opportunity instead of a problem. And I do feel great about the growth rate. And so that’s India. I think it’s all of those things,” he added.
Cook also revealed that the majority of the iPhone SE units sold in the country last quarter were Made in India.
“As you know, as I think we talked about before, we started manufacturing the iPhone SE there six, nine months ago so. And the majority of the iPhone SEs that we sold in the domestic market last quarter were manufactured there. And so we also have that going and are hoping that that winds up saving some amount of money over time and avoiding some of the compounding of taxes, et cetera,” Cook said.
Once again, Cook highlighted the progress India’s 4G networks have made in a relatively short short amount of time, having earlier called India’s 4G rollout truly impressive.
“The bandwidth issue has also been an issue, but as you point out, it is being addressed and between the large carriers there with Bharti and now Jio investing the way they are, the service in India is materially better than it was just 12 months ago. So there’s been a sea change there in a short period of time. So I feel good about all that, but we have a long way to go,” the Apple CEO concluded.