Analyst report says Huawei has replaced Apple iPhone as smartphone leader in China, despite iPhone 15 launch
Apple has been handed some potentially bad news in one of its most important overseas markets, after a Monday report from Jefferies analysts.
CNBC, citing the Jefferies update, reported that Apple’s iPhone has officially been dethroned from its position as the smartphone market share leader in China.
Apple is one of the few Western companies still operating in China, where it continues to be a leading smartphone provider in that market. This is despite the ongoing and increasingly bitter trade war between Beijing and the West.
CNBC reported the Jefferies analysts as concluding that sales of the recently launched iPhone 15 in China have disappointed, as Huawei sales have risen.
The analysts reportedly said smartphone sales in China have showed positive growth year over year, driven primarily by high double-digit growth in Android sales led by Huawei, Xiaomi and Honor devices.
But Apple’s iPhone has seen a significant, double-digit decline, and its volume growth year over year has been negative since the iPhone 15 launched, according to the analysts.
As a result, Huawei overtook the iPhone in the No.1 spot for market share, CNBC reported.
“We believe weak demand in China would eventually lead to lower-than-expected global shipments of iPhone 15 in 2023,” the analysts wrote, adding that the trend suggests the iPhone will “lose” to Huawei next year.
The Jefferies analysts reportedly wrote that Android’s volume growth can’t be credited to discounts, and that discounts on iPhones, excluding the iPhone 15 models, have been stable, while the average discount for Android “is not high.”
The analysts noted that resale iPhone 15 devices are all “trading at discounts to official selling prices,” which also reflects the weak demand in China.
CNBC also reported that analysts at Morgan Stanley have cut their price target for Apple from $215 to $210 in a report Monday.
The Morgan Stanley analysts are now apparently “more guarded” about Apple’s December quarter because of supply headwinds. They also cut their iPhone expectations for the quarter by 8 percent.
The Morgan Stanley analysts said they will be watching Apple’s total revenue, services revenue growth, gross margin and revenue growth in China from its September quarter, but that the December quarter guide “is what will matter most.”
Apple did not immediately respond to CNBC’s request for comment.
Last month the Wall Street Journal had reported that central government agencies in China had been ordered not to use iPhones for work or bring them into the office.
At one stage this caused Apple’s share price to experience its largest daily loss in a month.
Matters were not helped by another media report that the Chinese ban may also be imposed on staff at state-owned companies and government-backed organisations.
However China rejected the media reports that it had implemented a ban government workers’ use of Apple iPhones.
Apple and indeed any foreign mobile phone companies operating in China, have follow the country’s privacy laws to prevent “any person or organisation” stealing data stored in their customers’ phones.