Apple to boost India iPhone output to $40B by FY26 amid China shift

Apple is projected to increase its iPhone production in India to nearly $40 billion (approximately Rs 3,36,000 crore) by the end of FY26 as it continues to move away from China in a global supply chain full of geopolitical concerns and trade tariffs. Industry estimates suggest that this will allow Apple to satisfy 80 percent of its iPhone demand in the US and fully satisfy India's growing domestic market.

The news comes soon after Apple CEO Tim Cook mentioned during the company’s Q2 2025 earnings call that currently, the majority of iPhones sold in the US in the current April-June quarter will be made in India.

“For June, we do expect the majority of iPhones sold in the US will have India as their country of origin,” Cook said, citing reciprocal tariffs imposed by the US government that are reshaping production strategies.

This pivot reflects a decisive strategic response to tariffs being applied based on the country of origin of products. While China will remain the country of origin for most Apple products sold outside the United States, India and Vietnam are rising as crucial sourcing nations.

Apple expects its tariffs in the US to be $900 million dollars during the current quarter, but the long-term effects are unclear. This shift is also an expression of Apple's increasing commitment to India in electronics manufacturing, which has seen astonishing growth through the government production-linked incentive (PLI) scheme.

As of FY25, smartphones became India's highest export category, crossing a historical high of Rs 2 lakh crore as value. Apple was the biggest contributor to India's smartphone export value, with iPhones being responsible for roughly 70 percent of the total smartphone exports from India. 

In addition to increasing manufacturing in India, Apple is also increasing its commitment to India's market with plans to launch more retail stores this year (two are already open). Apple hit a quarterly sales record in the Indian market recently and articulated positive momentum across products and services.