Apple iPhone Sales Drop 30% in China in the First Week of 2024
Apple's iPhone sales in China fell by 30% in the first week of 2024, according to analysts at Jefferies. This decline highlights the growing competition from domestic rivals like Huawei. Despite aggressive discounting, Apple's sales continued to decline, while Huawei achieved flat growth. Apple is expected to face more competitive pressure throughout 2024, with Huawei gaining market share.
Apple's iPhone Sales Decline in China
According to a note from Jefferies analysts, Apple's iPhone sales in China dropped by 30% in the first week of 2024. This decline indicates the increasing competitive pressures faced by Apple from domestic rivals like Huawei. In comparison, other Android brands and Huawei achieved relatively flat growth year-over-year in the same period.
Despite offering aggressive discounts on multiple iPhone models through major Chinese online marketplaces, Apple's sales continued to decline. For instance, the iPhone 15 Pro and iPhone 15 Pro Max received a 16% price reduction on the e-commerce platform Pinduoduo. These efforts were not enough to offset the decline in sales.
The decline in Apple's sales represents a significant acceleration from the 3% year-over-year decline the company experienced in 2023 in its third-largest market. Jefferies noted that this decline equated to a 0.4% decrease in Apple's market share.
Competition from Huawei
Jefferies analysts attribute Apple's decline in China to intense competition from Chinese rivals, particularly Huawei. Huawei launched its Mate 60 series of phones in August 2023, which is seen as the company's comeback to the high-end smartphone market after years of U.S. sanctions.
During the final quarter of 2023, Huawei's share in the Chinese smartphone market increased by about 6%. The analysts predict that Apple will continue to face competitive pressure from domestic rivals like Huawei throughout 2024. They forecast a double-digit decline in Apple's shipment volumes while estimating Huawei to gain more market share.
Jefferies analysts estimate that Huawei will ship approximately 64 million smartphones worldwide in 2024, a substantial increase from the estimated less than 35 million shipped in 2023.
Outlook for the Chinese Smartphone Market
After ten consecutive quarters of falling shipments, the Chinese smartphone market is expected to rebound. The decline in Apple's sales and the rise of Huawei indicate a shifting landscape. Other analysts, like research firm IDC, also predict year-on-year sales growth in the fourth quarter of 2024.
It remains to be seen how Apple will navigate the competitive pressures in the Chinese market and attempt to regain market share. The rise of domestic rivals like Huawei poses a significant challenge for the U.S. tech giant.
