New Delhi, August 1, 2026 — India’s mobile app market has hit a new revenue milestone. In the second quarter of 2026, consumer spending on apps reached a record $345 million, up 35% year-on-year, according to a new report by Sensor Tower. The country now has the fastest app revenue growth among major markets globally.
Downloads and revenue surge
In Q2 2026:
- App downloads in India crossed 6.6 billion, the highest level since January 2024.
- In-app purchase (IAP) revenue from the Google Play Store and Apple App Store reached $345 million, a new all-time high.
- This marks the second straight record quarter after Q1 2026, which saw about $300 million in IAP revenue.
The data covers only in-app purchases on official app stores and excludes advertising revenue and third-party Android stores.
Non-gaming apps lead the charge
Non-gaming categories continue to drive monetisation:
- Non-gaming apps accounted for around 70% of total downloads.
- They generated nearly $240 million in revenue, up more than 50% year-on-year.
- Key growth areas include video streaming, quick commerce, ride-hailing, productivity tools and generative AI apps.
Gaming revenue also performed well:
- Mobile gaming revenue in India crossed $106 million in Q2.
- It rose 3.7% quarter-on-quarter, even as global gaming revenue fell 6.2%.
AI, streaming and micro-dramas shape spending
The report highlights several trends:
- Generative AI apps such as ChatGPT and Claude are seeing strong downloads and paid subscriptions. Claude’s revenue in India grew 19 times year-on-year.
- Short drama and micro-drama apps like StoryTV have crossed 800 million cumulative downloads and now rank among the top downloaded entertainment apps.
- Ride-hailing and quick commerce apps have gained traction, with some players hitting record monthly downloads and becoming category leaders by active users.
Why India is suddenly paying for apps
Analysts point to a mix of factors behind the shift from “downloads only” to “downloads plus payments”:
- Widespread adoption of UPI and other digital payment systems, making small in-app payments easy and frictionless.
- A growing middle class with higher disposable income and willingness to pay for premium content and services.
- Maturing local app ecosystem, with more Indian and global apps offering tailored subscription plans, freemium models and local-language content.
- Heavy investment in AI features, streaming libraries and niche content, which users are increasingly willing to pay for.
What this means for the app economy
India has long been the world’s largest app download market. The Q2 2026 data shows it is now also becoming one of the fastest-growing revenue markets:
- Annual in-app purchase revenue has more than doubled from about $520 million in 2021 to over $1 billion in 2025.
- Projections suggest annual IAP revenue could reach around $1.25 billion by end-2026.
- Global platforms are capturing a large share of this spending, but local players in entertainment, mobility and AI are also gaining ground.
