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Why Tim Cook wants to double down in India

Apple Inc. will open its maiden store in Mumbai on April 18, and in New Delhi two days later, making a direct retail entry into a market that was primarily catered through resellers.

India has become China-plus one market for Apple to produce iPhones. The U.S. company now makes almost 7% of its iPhones in India through partners including Foxconn Technology Group to Pegatron Corp., according to a Bloomberg report. This compares with 1% in 2021.

Apple is using its learnings in China to scale up its operations in India. “I wouldn’t expect to have a difference in those two markets,” Tim Cook, chief executive officer at Apple, said in an investor call in February.

India set a quarterly revenue record in the three months ended December. “We’ve set a quarterly revenue record and grew very strong double digits year-over-year,” Cook said. “And so, we feel very good about how we performed and that was—that’s despite the headwinds that we’ve talked about.”

Apple brought the online store to India in 2020 and is now looking to expand its retail presence. It has worked on financing options and trade-ins to make products more affordable and give people more options to buy. There’s a lot going on there, said Cook.

Apple doesn’t provide separate performance for India and the country is part of the Europe geography for the U.S. phone maker.

Apple saw strong growth in several emerging markets, including all-time iPhone revenue records for India and Vietnam, said Luca Maestri, senior vice president, and chief financial officer, during the call. The company saw its installed base of over 2 billion active devices led by double-digit increases in emerging markets such as Brazil, Mexico, India, Indonesia, Thailand, and Vietnam.

Of the total production, Apple exported $5 billion of iPhones from India in the year ended March 2023, nearly four times as much as the previous period, according to a Bloomberg report. Apple could look at simultaneous manufacturing of the next iPhones in India at the same time as in China later this year, pushing nearly a quarter of its iPhone production from India in the next two years.

Apple began its scale-up after the Covid-19 and the chip crisis. We actually did fairly well through Covid in India, said Cook. “I’m even more bullish now on the other side of it or hopefully on the other side of it. And that’s the reason why we’re investing there,” he said. “We’re bringing retail there and bringing the online store there, and putting a significant amount of energy there. I’m very bullish on India.” Bloomberg

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