Apple iPhone Q1 Sales In China Fall 19 Percent, Says Counterpoint

Apple and its CEO Tim Cook continue to encounter headwinds in China, after new research recorded a sales decline in one of the world’s largest mobile markets.

The new report from market research firm Counterpoint Research, confirmed that Apple saw sales of its iPhone portfolio fall 19.1 percent in the first three months of the year in China.

China Smartphone Sales Remain in Black on Huawei, HONOR, Xiaomi Outperformance

It came after Counterpoint last month had found that Apple iPhone sales in China had fallen 24 percent in the first six weeks of 2024, due to stiff competition and an abnormally high January 2023.

China sales

Now Counterpoint has reported that Apple is facing intense competition in China, after it noted that Huawei experienced a 69.7 percent surge in smartphone sales in the country during the same period.

Counterpoint noted that Huawei’s growth was largely attributed to the successful launch of the 5G-capable Mate 60 series as well as its enduring brand reputation – all of which helped it gain a massive share in the $600+ premium segment.

Huawei is currently only the fourth-largest smartphone maker in China and despite it’s comeback, Huawei spinoff Honor still managed to grow 11.5 percent year-on-year (YoY) in Q1 driven by its popular models, such as the X50 and Play 40, and its expansion in offline channels.

Counterpoint also found that China’s smartphone sales grew 1.5 percent YoY in Q1 2024, marking the second consecutive quarter of positive YoY growth.

“Momentum seems to be building on a recovery as China’s smartphone sales continued their growth trajectory and grew 4.6 percent QoQ in Q1 2024,” noted Counterpoint’s associate director Ethan Qi.

“The sales promotions during the Chinese New Year festivities were the biggest growth driver,” said Qi. “The average weekly sales during the four weeks leading up to the Chinese New Year saw a robust growth of 20% when compared to a normal week.”

iPhone recovery?

Meanwhile senior research Analyst Ivan Lam commented on the OEM players operating in the Chinese smartphone market.

“Vivo gained the top spot this quarter with 17.4 percent share driven by strong sales of the Y35 Plus and Y36 models in the low-end segment and the S18 in the mid-end segment,” said Lam.

“Honor ranked second with a 16.1 percent share, followed by Apple with a 15.7 percent share. Apple’s sales were subdued during the quarter as Huawei’s comeback has directly impacted Apple in the premium segment. Besides, the replacement demand for Apple has been slightly subdued compared to previous years.”

Looking forward, Lam saw the possibility of an iPhone recovery. In January this year Apple offered extremely unusual iPhone discounts in China, as it faced increased competition from domestic rivals and slowing demand.

“We are seeing slow but steady improvement from week to week, so momentum could be shifting,” said Lam. “For the second quarter, the possibility of new colour options combined with aggressive sales initiatives could bring the brand back into positive territory; and of course, we are waiting to see what its AI features will offer come WWDC in June. That has the potential to move the needle significantly longer term.”

Counterpoint Research estimates low single-digit YoY growth for China’s smartphone market in 2024.

The firm said it expects AI features embedded into Chinese smartphone makers’ handsets to drive renewed demand for new mobile phones.