Apple today reports its earnings for the financial year Q2 2016. Even though Apple sold only 51.2 million iPhones in the quarter compared to 61.2 million in the year-ago quarter, down 16%, during the conference call Apple CEO said that iPhone is still attracting millions of first-time smartphone buyers each quarter, especially from emerging markets. He also said that iPhone sales were up 56% in India from a year ago.
Apple also said there is acceleration in iPhone upgrades and 40% iPhone sales growth over the previous year. There are also a lot of switchers from other platforms, regarding that Tim Cook said:
As we look at switchers, we’re extremely excited that for the first half we set a record from switchers from other platforms, the largest we’ve ever seen in any six-month period before, so we’ve got traction there. And then on emerging markets, if you take a look at India, we grew by 56%, and we’re placing increasing emphasis in these areas, where it’s clear there will be disproportionate growth versus the more developed areas.
Tim Cook also said 4G will drive growth of iPhone in India since the LTE rollout has just begun to expand in India. Regarding the Indian market, Tim Cook said:
And so the infrastructure is one key. The second one is building the channel out. Unlike the U.S., as an example, where the carriers in the U.S. sell the vast majority of phones that are sold in the United States, in India the carriers in general sell virtually no phones. And so it’s out in retail, and retail is many, many different small shops.
And so we’ve been in the process – it’s not something that we just started in the last few weeks. We’ve been working in India now for a couple of years or more, but we’ve been working with great energy over the last 18 months or so, and I’m encouraged by the results that we’re beginning to see there, and believe there’s a lot, lot more there. It is already the third largest smartphone market in the world. But because the smartphones that are working there are low end, primarily because of the network and the economics, the market potential has not been as great there. But I view India as where China was maybe seven to ten years ago from that point of view, and I think there’s a really great opportunity there.