Apple’s smartphone sales in China have suffered a significant decline of 19.1% in the first quarter of 2024, according to a report by Hong Kong-based Counterpoint Research. This downturn highlights the challenges faced by the iPhone maker as it loses market share to local rivals in the world’s largest smartphone market.
Counterpoint Research indicates that iPhones accounted for 15.7% of smartphone sales in China during the first quarter of 2024, marking a 19.7% year-over-year decrease. Meanwhile, Huawei, a key competitor to Apple in China’s premium smartphone segment, has experienced a significant resurgence, with sales jumping by 69.7% year-on-year. This growth is attributed to the success of Huawei’s 5G-capable Mate 60 series, featuring an innovative chip.
Apple remains slightly ahead of Huawei’s 15.5% market share, but the iPhone maker has dropped from first to third place, falling behind Chinese brands Vivo and Honor, the former subsidiary of Huawei. Bloomberg reports that this sharp decline in the first quarter represents Apple’s worst performance in the Chinese smartphone market since 2020. Forbes has reached out to Apple for comment.
Counterpoint Senior Research Analyst Ivan Lam attributes Apple’s subdued sales to Huawei’s comeback, which has directly impacted Apple in the premium segment. Additionally, Apple’s replacement demand has been relatively weaker compared to previous years. This decline in China sales follows a recent report by market research firm IDC, indicating that iPhone shipments in the first quarter of 2024 were down 9.6% year-over-year. This decline in shipments resulted in Apple losing its position as the world’s biggest phone maker to Samsung, which shipped 60.1 million phones in the first quarter compared to Apple’s 50.1 million.
In contrast to iPhones, overall smartphone shipments in the first quarter saw a 7.8% increase, driven by the robust performance of Chinese brands. Xiaomi, despite ranking sixth in its home country, shipped 40.8 million phones globally in the first quarter, securing the third position behind Samsung and Apple, and reporting a substantial 33.8% growth.
This report emerges amidst a challenging 2024 for Apple, which began the year as the world’s most valuable company. In February, Apple reportedly abandoned its ambitious decade-long effort to develop a self-driving car. Apple investors have expressed concerns that the company may be lagging behind rivals like Microsoft, Google, and Meta in the artificial intelligence race. According to the Wall Street Journal, Apple has engaged in discussions with Google to consider integrating the search giant’s Gemini AI service into the iPhone, indicating that Apple’s internal AI advancements may still trail those of its competitors.
Apple is also facing significant legal and regulatory challenges, with the Justice Department and multiple U.S. states filing a landmark lawsuit in March, alleging that the company violates antitrust laws through restrictive policies that harm competitors and consumers. Since the beginning of this year, Apple’s share price has decreased by 10.67%, with a further 0.36% decline in premarket trading on Tuesday.
