Apple CEO Tim Cook leverages China experience to boost India operations, as country achieves record revenue
3 min read . Updated: 18 Apr 2023, 09:08 AM IST
Premium- During an investor call in February, Apple's CEO Tim Cook noted that the company is leveraging its experiences in China to enhance its operations in India. Cook expressed confidence in India's potential, stating that he did not expect a significant difference between the two markets.
Apple is set to make a direct retail entry into the Indian market by opening its first store in Mumbai on April 18, followed by another store in New Delhi two days later. Previously, the Indian market was primarily catered to through resellers, but Apple's move to establish a direct retail presence highlights the importance of India in its China-plus one strategy. In fact, Apple now produces almost seven percent of its iPhones in India through partnerships with companies like Foxconn Technology Group and Pegatron Corp., a significant increase from just one percent in 2021.
During an investor call in February, Apple's CEO Tim Cook noted that the company is leveraging its experiences in China to enhance its operations in India. Cook expressed confidence in India's potential, stating that he did not expect a significant difference between the two markets. This optimism is well-founded, as India recently achieved a record-breaking quarterly revenue in the three months ending in December.
Despite facing several challenges, the country's revenue growth was strong and exceeded expectations. Apple is well-positioned to capitalize on India's growth and further expand its operations in the country.
After introducing its online store to India in 2020, Apple is now aiming to further expand its retail presence in the country. To make their products more accessible, the company has been working on financing options and trade-in programs, offering customers more choices when it comes to purchasing Apple products.
"There's a lot going on there," noted Cook. However, it is worth noting that Apple does not provide a separate breakdown of its performance in India, as the country falls under the Europe geography for the tech giant. Nonetheless, Apple's commitment to the Indian market is evident and is likely to yield positive results as the company continues to expand its offerings and improve accessibility for its products.
According to Luca Maestri, the senior vice president and chief financial officer of Apple, the company experienced robust growth in several emerging markets, including India and Vietnam, both of which achieved all-time high iPhone revenue records.
Additionally, Apple's installed base of over two billion active devices was led by double-digit growth in countries such as Brazil, Mexico, India, Indonesia, Thailand, and Vietnam. This growth in emerging markets underscores Apple's commitment to expanding its reach globally and catering to the diverse needs of consumers in various regions.
According to a report by Bloomberg, in the year that ended in March 2023, Apple exported $5 billion worth of iPhones from India, which is almost four times the amount exported in the previous year. The company is considering the possibility of manufacturing the upcoming iPhone models in India and China simultaneously, with the aim of producing almost 25 percent of its iPhones in India over the next two years.
This move would not only reduce Apple's dependence on China for its production needs but would also serve to bolster India's position as a vital manufacturing hub for the company. Apple's continued investments in India and its efforts to diversify its supply chain could yield significant benefits in the years to come.
Apple commenced its expansion in India after the outbreak of Covid-19 and the global chip crisis. Despite the pandemic, Apple's operations in India performed well, as per Cook. He added that he is even more optimistic now that the worst is hopefully behind us.
This optimism has led to increased investments in India, including the launch of retail stores and the online store. Apple is putting in significant efforts and resources into India, and Cook remains bullish about the country's potential.