Apple Inc. (NASDAQ:AAPL) has reached a major milestone in India. The company generated $10 billion in annual sales for the first time while continuing to deliver double-digit growth and expand its retail presence in one of its fastest-growing markets. The achievement underscores Apple’s long-term opportunity in the region. Despite that progress, the market’s attention has shifted somewhere else. Recent analyst commentary has turned cautious, highlighting rising memory costs, supply constraints, and a recent downgrade that left the price target unchanged. As a result, investors are placing greater focus on short-term headwinds than on the company’s strong momentum in India.
India Becomes a Bigger Piece of Apple’s Growth Story
India is becoming an increasingly important market for Apple, both as a source of growth and as a manufacturing hub. Bloomberg reported on August 4 that the company generated $10 billion in revenue during the fiscal year through March, rising from around $9 billion a year earlier. The increase was driven mainly by iPhone sales, alongside rising demand for iPads and MacBooks. Apple also continued to expand its physical presence, opening its sixth official retail store in Mumbai in February.
Beyond sales, India has become increasingly important to the company’s supply chain. The country now has five iPhone manufacturing plants, producing one out of every four iPhones globally. Although India still accounts for a relatively small share of Apple’s total revenue, it is becoming a critical growth engine as sales in China face intensifying competition, particularly from Huawei Technologies.
Why Phillip Securities Turned More Cautious on Apple
Phillip Securities downgraded the stock from Neutral to Reduce while keeping its price target unchanged at $290. Its cautious view is driven by rising memory costs and supply constraints, concerns that align with Apple’s own Q4 revenue guidance of $111.7 billion to $113.7 billion, which came in below Wall Street’s estimate of around $114.3 billion.
CEO Timothy Cook characterized the increase in memory costs as a hundred-year flood, and management expects gross margin to fall to 47-48%. The analyst also sees little evidence so far that Apple Intelligence is encouraging customers to upgrade their devices.
Hedge Funds Stay With Apple
Despite the cautious analyst commentary, institutional sentiment has remained steady. The number of hedge funds holding Apple increased from 169 at the end of the fourth quarter of 2025 to 170 at the end of the first quarter of 2026. The short interest of just 1% also suggests that very few investors are betting against the company.
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