Apple has posted its slowest growth in India in the last five years, according to reports. Though the iPhone-maker managed to increase sales by 17 percent as per its filing with the Registrar of Companies (RoC), that is significantly lesser than the average 40 percent growth it had been clocking until 2017. Much of it was due to a low demand for Apple’s new models, the iPhone 8 and the iPhone 8 Plus, which have met with a somewhat tepid response not only in India but also elsewhere. Add to that, demonetization late last year hit consumer upgrade cycles, and considering Apple sells premium products, the impact was noticeable.
Sales have particularly dipped since 2015-16 when Apple had posted a massive 53 percent growth. In 2016-17, sales grew 17 percent to $1.8 billion (Rs 11,619 crore). Apple has stated that India is one of its fastest-growing territories in the world. However, the iPhone-maker’s share is a mere two percent in a market flooded with budget smartphone brands. Apple continues to operate in the premium segment along with Samsung’s Galaxy 8 series. Both Amazon India and Flipkart had recorded a slowdown in high-value smartphone sales in the wake of demonetization.
However, India is important for Apple where it added $1 billion in sales over a year. Its first $1 billion (which Apple clocked in 2015) had taken much longer. In an earnings call in November, Apple CEO Tim Cook stated, “Revenue from emerging markets outside of greater China was up 40 percent, with great momentum in India, where revenue doubled year over year… 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.”
Apple sold 2.9 million units in India in FY17 compared to 2.2 million units in FY16, according to Counterpoint Research. The iPhone 8 and iPhone 8 Plus have been duds, and Apple’s older models like the iPhone 6s and the iPhone 7 have been better-selling models. Furthermore, smaller, cheaper models like the iPhone 4s and iPhone 5s have also grown, thus bringing drown the average selling price for Apple and hurting growth. While the new iPhone X has recorded high demand, its limited supply reduced any positive impact on Apple’s overall sales in India.