India's mobile app market generates record $345 million in Q2 revenue

India’s mobile app ecosystem posted a record $345 million in in‑app‑purchase (IAP) revenue in the second quarter of 2026, a 35 % year‑on‑year increase, according to Sensor Tower. Downloads remained steady at about 6.6 billion, with non‑gaming apps accounting for roughly 70 % of all downloads and generating nearly $240 million in revenue.

Generative‑AI and entertainment apps were the primary drivers of the monetisation surge. ChatGPT was the most downloaded non‑gaming app, while short‑drama platform Story TV emerged as the sector leader, posting over 50 % quarter‑on‑quarter revenue growth. Shopping app Meesho topped the e‑commerce category, and gaming revenue reached a record $106 million, outpacing the global market despite flat download numbers.

Analysts attribute the growth to broader adoption of digital payments such as the Unified Payments Interface, reduced friction for subscriptions, and rising consumer willingness to pay for premium digital services.