Apple on track for record quarter as iPhone 17 draws crowds

People started gathering outside each of its four outlets on Friday in the country before the new generation of devices went on sale, and the crowds sustained through the day. Chief executive Tim Cook even tweeted a photograph of Apple’s Mumbai storefront.

Preorders were nearly 10% more than last year, according to three analysts that Mint spoke with. One of them said the sales may surge 19% on-year in the first week itself.

Apple is poised to surpass 5 million iPhone sales this quarter, potentially pegging the July to September period as the 15th straight quarter of record sales in India, the analysts said.

“Preorders for the iPhone 17 series have been stronger than last year. Overall, early sales are expected to be higher this year, with shipments in the September quarter this year expected to cross 5 million units," said Navkendar Singh, associate vice-president at market researcher, International Data Corporation (IDC) India. “The high interest is being driven by the base version of the new iPhone, the iPhone 17, being a considerable upgrade over previous base models—which is likely drawing users in to upgrade their older devices."

Sanyam Chaurasia, principal analyst at market research and advisory firm, Omdia, said “The preorders of the iPhone 17’s base model, compared with the iPhone 16, were higher by as much as 30% this year—fuelling scope for higher sales of the new phone this year in general."

Pro, Pro Max instant hits

Three of its four stores in India reported a sellout of the company's ‘Pro’ and ‘Pro Max’ variants of the iPhone 17 series. Third-party retailers also concurred, adding that supply itself was short for Apple’s top devices this year.

“Apple, with its aspirational brand image, is successfully riding the premiumization trend in India," said Tarun Pathak, partner and director at fellow research firm Counterpoint India. “It’s strategy across product portfolio, channels and manufacturing is paying off, with the initial demand in the first week of sales for the iPhone 17 series being 19% higher than the iPhone 16 series."

Pathak said that Apple is seeing growth in value as well as volume in sales. “The 256GB storage coupled with two-year, no-interest financing options, is adding value as a purchasing option for buyers—and incrementally adding value to Apple’s India sales as well," he said.

Singh and Pathak concurred that Apple is likely to outsell its annual projection of 15 million iPhones in India this year. “The festive season sales are expected to be 28% higher than last year, leading to yet another consecutive year of record sales for Apple in India," Pathak added.

Apple did not officially comment on the first day of sales in India.

“Overall, supplies of the Pro model to retailers are likely to ramp up over the coming weeks," said Omdia’s Chaurasia. “The iPhone 17’s strong demand is being fuelled by the significant jump in overall features, making it attractive for buyers."

Three retailers that Mint spoke with said that supplies of the ‘Pro’ and ‘Pro Max’ variants comprised roughly 3% of the first round of sales. The second round of supplies of these devices are expected by Monday, accounting for 10% of all devices being supplied to sellers across the country.

However, supply shortage was not the only reason behind the sellout. A person close to the developments on Friday said that based on preorders, Apple’s top iPhones were sold out until 2 October.

In Delhi, the person cited above said, more than 600 people had queued up even before the Apple store opened at 8 am on Friday. Videos of long queues surfaced from Apple’s store in Mumbai as well.

Quarterly boost

Apple’s iPhone 17 series was launched on 9 September, priced ₹82,900 onward in India. A second person close to developments said that while all units of the iPhone 17 and 17 ‘Air’ were assembled in India, the Pro variants have mixed sourcing to manage supply chain demands across global markets.

Earlier this year, Apple decided to supply the US, its largest market, with iPhones imported from India instead of its largest supply hub of China.

Overall, IDC’s Singh said that driven by early demand, the iPhone 17 may contribute “up to 15% of Apple’s September quarter smartphone sales in India".

“This would translate to around 700,000 units of the new iPhone 17 being sold in India in the last 11 days of the quarter, with the rest of the demand being driven by the iPhone 16—which is now discounted in pricing in the market," Singh said.

Tardy AI progress

The demand surge defies analysts' outlook on Apple's slow progress in AI. On 9 September, Apple shares in the US declined 2.2% on the day, as the Cupertino giant—the world's third-largest company with a valuation of $3.6 trillion as of Friday—largely kept away from mentions of AI when it unveiled the iPhone 17. While the company announced its Apple Intelligence suite in June last year, experts have noted that the company remains behind key rivals such as Google and Microsoft in its pursuit of integrating generative AI features across all its products.

“That's not a surprise, really. No user is going and asking for AI as a priority feature on their smartphones, so for now, Apple's demand remains insulated from any AI shock and remains on track for sustained double-digit growth for the seventh year in a row," said IDC's Singh. “Most smartphone AI use cases are also not strong enough to become a compelling factor for phone sales, and the iPhone 17's strong demand is a testament to it."