iPhone shipments in China declined 2 percent in Q4 as Apple competes with Huawei for market share

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Apple's smartphone shipments in China declined 2.1 percent in the final quarter of 2023 compared with the same period a year earlier due to increased competition from local rivals led by Huawei, data from research firm IDC showed on Thursday.

The decline underscores the challenges the U.S. company faces in its third-largest market, as some Chinese companies and government agencies limit the use of Apple devices by employees, a measure that restricts access to Chinese apps on security grounds. Reflects US government sanctions.

Huawei, whose smartphone business was decimated by US sanctions, also bounced back with new launches last year, intensifying competition in the world's largest smartphone market, which grew just 1.2 percent in the last quarter of 2023.

According to IDC data, Huawei's shipments increased by 36.2 percent in the last quarter of the year. The company became the fourth-largest smartphone vendor in China during the period with 13.9 percent market share, up from 10.3 percent in the same quarter a year ago.

However, according to IDC, for the full year 2023, Apple overtook Vivo to become the top smartphone vendor with 17.3 percent market share. This is the first time Apple has become the top seller in China, but analysts predict its sales will come under pressure again this year.

IDC said Apple's high-end market share in China has been hit by rival products and limited product upgrades by Apple, reducing the overall attractiveness of iPhone models.

It added that Apple still attracts demand from many consumers through substantial discounts and promotions carried out through third-party distribution channels.

Earlier this month, Apple offered a rare discount on its iPhones, cutting retail prices by CNY 500 ($70 or about Rs 5,800) amid growing competitive pressure.

Jefferies analysts predicted earlier this month that Apple's shipment volumes will continue to decline by double digits in 2024, while Huawei is seen increasing its market share.

They estimate Huawei will ship about 64 million smartphones worldwide in 2024, a significant increase from the fewer than 35 million units projected for 2023.

Overall, shipment volume in China's smartphone market in the fourth quarter was 73.63 million units. IDC said shipment volumes for the full year were down 5 percent to 271 million units.

Apple will release its quarterly results next week.

© Thomson Reuters 2024


Apple launched the iPad Pro (2022) and iPad (2022) this week, along with the new Apple TV. We discuss the company's latest products, along with our review of the iPhone 14 Pro on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music, and wherever you get your podcasts.
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