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The Counterpoint research firm is looking at Apple's ongoing struggles in India. As Reuters notes, the counterpoint data shows that iPhone sales in India are expected to be hit hard during the holiday season.
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According to Neil Shah of Counterpoint Research, distribution channel inventories suggest that iPhone sales in India are expected to be between 700,000 and 800,000 units in the fourth quarter of 2018 (first quarter of Apple's 2018 fiscal year) . That's about $ 1 million in the same quarter of last year.
Regarding the third quarter (which is the fourth fiscal quarter of Apple), Shah says iPhone sales were about 450,000 units this year, against 900,000 units last year.
"Sales are expected to fall for the first time in four years," said Shah. "If you look at Q3 – it was 900k last year and this year is almost 450k.
For 2018, Apple is expected to sell about 2 million phones in India, against about 3 million in 2017, according to Counterpoint. For Apple, this decline in iPhone sales in India is the first decline in four years.
Apple's earnings conference call for the fourth quarter of this week, Tim Cook said he was still optimistic that the Indian government is allowing Apple to open retail stores in the country, saying :
We had very good productive discussions with the Indian government. And I expect that at some point, they will agree to allow us to import our stores in the country.
Cook added that he viewed Apple's struggles in India as "a slowdown over a very long time" and was optimistic about middle-class growth and innovation in the country.
Of course, retail stores are not Apple's main problem in India. The company's devices are also much more expensive than those of the competition, and Apple would have a hard time attracting Android users:
"IPhones have become more expensive and features and specifications are not as convincing. The installation base of Android has increased significantly; the new clientele (for Apple) does not come, "said Shah.
On the positive side for Apple, revenues in India are expected to be stable or slightly higher than last year due to higher prices for the iPhone. This is despite the fact that "more than half of the phones sold" in India are older models.
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