Recent reports from two top market research firms indicate that the iPhone has dropped from being the number one-selling smartphone in China, falling to third place during the last quarter of the previous year.
One reason for this shift is heightened competition from domestic brands, while another factor is Apple’s lack of AI capabilities in the Chinese market…
Insights from the Canalys report
Canalys was the first to shed light on Apple’s diminishing sales performance in China.
According to Canalys, iPhone shipments in China experienced a 25% decline year-on-year in the last quarter.
This led to Apple’s market share plummeting from 19%—a leading position in 2023—to a tie for third place with Oppo and Honor in 2024, each holding 15% of the market.
Counterpoint’s Findings
Although the specific numbers vary, Counterpoint Research has arrived at a similar conclusion.
Huawei has reclaimed the top spot, followed by Xiaomi and Apple. […] In Q4 2024, Huawei achieved an 18.1% market share, marking the first time since the U.S. ban that Huawei returned to the leading position. […]
Xiaomi came in second in Q4 2024 with a 17.2% share, boosted by robust growth between Q3 and Q4, largely due to the success of its flagship Mi 15 series launched in October. This year, Xiaomi has made notable strides in premium market offerings. […]
With the increasing competition from Huawei and other Chinese brands moving into the premium segment, Apple ended up third in the quarter with a 17.1% market share.
The Role of AI Features
Chinese brand smartphones are now equipped with AI features, whereas Apple Intelligence is not yet available in China.
Apple aimed to deploy its proprietary generative AI model; however, the Chinese government effectively said this would not be allowed.
Recently, the government indicated that rolling out Apple Intelligence in China would be a “complex and lengthy process” unless Apple collaborates with a local AI firm. Aligning with a Chinese entity would instead be “efficient and uncomplicated.”
Reports suggest Apple is in discussions with Tencent and ByteDance, but there has yet to be any substantial progress.
Photo by Christian Lue on Unsplash
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