Apple’s iPhone sales have taken a significant hit in the first six weeks of 2024, with a reported drop of 24% in China. This decline can be attributed to the fierce competition that Apple is facing from local smartphone brands such as Huawei, Oppo, Vivo, and Xiaomi. While Apple shares plummeted by more than 2% in early trading in the U.S., Chinese tech giant Huawei’s consumer business has been experiencing a resurgence in China, particularly after the successful launch of its Mate 60 smartphone.
The competition posed by Chinese smartphone companies has been a major challenge for Apple in the region. Despite facing some competition, other local brands like Oppo, Vivo, and Xiaomi recorded less significant declines compared to Apple. Oppo’s smartphone shipments fell by 29% year on year, while Vivo and Xiaomi saw declines of 15% and 7%, respectively, according to Counterpoint Research.
Rise of Huawei and Honor
Contrary to the decline faced by Apple, Huawei and its spinoff Honor have seen an increase in smartphone unit shipments. Huawei recorded a notable rise of 64% year over year, while shipments of Honor handsets also saw a 2% increase. The success of Huawei and Honor in the market poses a significant challenge to Apple’s dominance in China.
Huawei’s comeback in the Chinese market can be attributed to the launch of its Mate 60 smartphone, which offers 5G connectivity. Despite facing sanctions from the U.S. government in previous years, Huawei has managed to regain its footing in the market. The presence of Huawei as a major competitor to Apple has impacted the sales of iPhones in China, as customers are drawn to Huawei’s high-end devices.
In addition to competition from local brands, Apple has also faced challenges with its supply chain in China. The abnormally higher ‘sell-through’ in January 2023 as compared to 2024 can be attributed to supply chain disruptions caused by Covid-19 lockdowns in China. These disruptions have affected Apple’s ability to meet market demands and have contributed to the decline in iPhone sales in the region.
Apple’s iPhone sales in China have faced a significant decline due to intense competition from local brands like Huawei, Oppo, Vivo, and Xiaomi. The resurgence of Huawei in the market, along with supply chain disruptions, has further impacted Apple’s position in the region. As Apple continues to navigate the challenging landscape in China, it will be essential for the company to strategize effectively to regain its foothold and stay competitive in the market.
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