As the Russian ruble plunges in value against the U.S. dollar, Apple (NASDAQ: AAPL) has had little choice but to increase prices to mitigate the currency's extreme volatility.
The iPhone maker took down its online store in Russia last week as it reviewed pricing options, and the company today raised iPhone prices by 35%.
Apple had already raised the cost of an iPhone in Russia in late November.
Last month, Apple boosted the price of a 16 GB iPhone 6 by 25%, from 31,990 rubles to 39,990 rubles.
Today's increase puts that same model at 53,990 rubles (approximately $956 at current exchange rates). That means the price has increased by nearly 70% in less than a month.
Russia's largest wireless carrier, Mobile TeleSystems (NYSE: MBT) , regularly releases reports on the nation's mobile retail sector, providing a useful view of the Russian phone market (including feature phones and smartphones).
Smartphones continue to gain traction within Russia, with shipments jumping 23% in the first half of 2014. This growth is being driven by strong demand for LTE devices.
As usual, Apple has long been perched at the premium end of the pricing spectrum, and so has had limited success on the unit market share front. Apple had 7% share within MTS' retail chain in the second quarter.
More broadly, though, demand in Russia continues to shift to lower-cost devices.
Only 11% of smartphone units sold in the second quarter cost over 15,000 rubles. Even before Apple's price increases, the 31,990 ruble price tag for the iPhone 6 was well into premium territory.
Now at 53,990 rubles, Apple's latest and greatest seems even more out of reach to the average Russian consumer. Keep in mind that smartphones aren't subsidized in Russia, either, making the sticker shock that much more potent.
