Apple's iPhone sales performance in India reached its strongest quarter to date, signaling that the Cupertino, Calif.-based company is finally making progress in the world's fastest-growing smartphone market. According to market research firm Counterpoint, iPhone sales in India rose to 2.3 million units in the fourth quarter of last year, up 34 percent from the same period last year.
China's Xiaomi and South Korea's Samsung Electronics sold 9.3 million and 7.2 million smartphones respectively in the quarter, leading the way in terms of sales.
However, according to Counterpoint's calculations, Apple seems to be earning more than any of its competitors due to the high price of the iPhone. Apple's quarterly revenue is estimated at $2.09 billion, slightly higher than Samsung, which is about $2 billion.
"This is a turning point for Apple in India," said Neil Shah, a partner and head of research at Counterpoint Technology Market Research in Mumbai. "During the pandemic, Indians are willing to spend money on high-end phones because everyone's life revolves around their phones and there is nothing else to buy."
While Apple is the world's most valuable company with the iPhone's popularity, it's struggling in the Indian market, which has a population of 1.3 billion. Expensive iPhones are far beyond the reach of many local consumers, exacerbated by the high import tariffs apples pay on phones made abroad.
In 2018, Apple suffered a number of executive departures in India, sales declined, and its online discount practice angered local retail partners and sparked protests. Apple sold 1.8 million iPhones that year, down from its most recent quarterly sales. Since then, however, the tech giant's strategy has changed dramatically. It opened its own online store in India, simplified discounts, and began making iPhones locally. The company plans to open its own retail stores in several cities in the coming quarters.
During India's most recent October-December, during India's festive shopping and gift-giving season, the phone maker priced its basic iPhone 12 at less than Rs 50,000 ($668) and offered cashback rewards and a simple payment plan.
Apples are still difficult to sell in India, where per capita income in 2020 is less than $2,000, according to the World Bank. Counterpoint data shows that in the most recent quarter, the average selling price of the iPhone in India was $908, while Samsung's was $278 and Xiaomi's was $172.
Although Apple's market share has risen, it still remained at a single-digit level of more than 5% in the quarter. Indians bought 44 million smartphones during this period.
Apple also faces challenges beyond market prices in India. Apple's manufacturing partners, Foxconn Technology Group and Wistron Corp. ) has been hit hard in India over the treatment of workers. In addition, India's antitrust regulator, the Competition Commission of India, has begun investigating app store fees.