After receiving, yesterday, a fined 1,8 billion euros by the EU they still come bad news for Apple, this time coming from China. In the first six weeks of 2024, the iPhone sales in China have suffered a 24% decrease. A significant drop in sales caused by growing competition from local manufacturers, with Huawei at the forefront but also reflecting a difficult period for the Chinese telephony market, which overall recorded a 7% decrease in sales compared to 2023.
So it wasn't enough for Apple reduce retail prices to attract sales and reverse the trend. The 5% price cut, up to 500 yuan (about $70), on some iPhone models was a limited-time promotion, designed to boost sales ahead of the Chinese holidays in mid-February. Indeed, last week, the Cupertino company launched discounts on some iPhone models of up to 1.300 yuan (about $180,68) through flagship stores on Tmall, Alibaba's main marketplace platform.
Apple in China: market share drops to 15%
According to the report of Counterpoint, a global technology market research company in the TMT (Technology, Media and Telecommunications) industry, the market share of Apple in the smartphone sector in China it fell to 15,7%, ranking at fourth compared to second place in the previous period, when it held 19% of the market. In the meantime, Huawei rose to second place with a market share of 16,5%, compared to 9,4% the previous year, thanks to the increase in sales of Mate 60, a high-end smartphone that successfully challenged the iPhone, contributing to a 64% sales increase for Huawei over the same period.
Huawei managed to recover after the ban imposed in the United States by Donald Trump. Meanwhile, companies and government departments have limited use of Apple devices among staff, in response to US government restrictions on Chinese apps for security reasons.
Apple in China: weak forecast for 2024
Counterpoint estimates that Apple's overall growth will remain weak in the first quarter of 2024 due to moderate consumer spending and limited new product launches.
Apple “faced stiff competition at the high end from a resurgent Huawei, while being squeezed in the middle by aggressive pricing from OPPO, Vivo and Xiaomi,” he said Mengmeng Zhang, senior analyst at Counterpoint.
“Consumer confidence will have to increase to stabilize the market, but right now it's a difficult decision with everything that's going on, especially in real estate,” the senior analyst said Ivan Lam, adding “as far as Apple is concerned, there is more room for maneuver in the short term. This weekend's aggressive promotions are just one example."
