Despite the global smartphone market slump, Apple has surprised its investors with the rise in iPhone sales, which the Chief Executive Tim Cook credits to emerging markets like India. Cook believes that emerging markets will provide more growth opportunities for the company due to their youthful populations and relatively few iPhones.
Apple’s Success in Emerging Markets
Apple’s successful second-quarter sales report revealed that iPhone sales rose 1.5%, resulting in $51.3 billion in revenue, despite global smartphone shipments falling 13% in January to March. Research firm, Canalys, even noted that Apple gained market share from Android phones.
Apple recorded sales records in various countries across South Asia, Latin America, and the Middle East. To investors during a conference call, Cook announced that the company acknowledged the potential in these markets and invests in them.
Apple Focuses on India
Indisputably, India is where Apple is focusing its attention. Recently, the company opened its first two retail stores in Mumbai and Delhi. Cook acknowledged that Apple had set a quarterly record in India, and percentage growth was very strong double digits year-over-year. Apple was the second highest revenue-generating brand in India in 2022 and gained 18% of the total value of smartphone shipments, second only to Samsung.
In an interview with Reuters, Cook stated that the opportunities for Apple in India are present in services, services in which he believes the company is always looking to expand. Cook added that average revenue per user, also known as ARPU in the subscription business, would take time to catch up to Apple’s other markets, but the company nonetheless sees this as a prime opportunity.
Secondary Smartphone Sales
One reason for Apple’s gains in both emerging and developed markets is a boom in the market for used iPhones. Sales of refurbished iPhones worldwide hit 16% in volume in 2022, with India accounting for a significant chunk of it with a 19% jump, according to Counterpoint. Furthermore, iPhones make up 11% of secondary smartphone sales in India.
Cook believed that the company had boosted the used iPhone market by offering trade-in deals on its iPhones and building them sturdy enough to last several owners. The company encourages the market and provides an opportunity to hit several price points that they would not otherwise play in, according to Cook.
The Bottom Line
The rise in the global smartphone slumps, coupled with Apple’s success can be attributed to their presence in emerging markets, especially India. Cook sees potential growth opportunities in these markets and believes that India is on the brink of intensifying its focus on growth in terms of its middle-class population.
As Apple continues to make strides in emerging markets and the secondary smartphone market, it remains to be seen how the company will further its impact on the global smartphone industry. Given its emphasis on growth via strategic investments combined with key insights from data analytics, Apple may continue to surprise the market in the years to come.