In the second quarter, Apple faced a significant setback in China as it was pushed out of the top five smartphone vendors list. This decline in rankings can be attributed to the intense competition from domestic brands, most notably Huawei. According to a report by Canalys, Apple’s market share in China dropped to 14% in the second quarter, down from 15% in the first quarter and 16% from the same period last year. This marks a significant decrease for the tech giant, which was previously the third-largest smartphone vendor in China.
Apple’s shipments have been on a downward trend, particularly since the first quarter when there was a 25% year-on-year decrease in units shipped, down to 10 million. In the most recent quarter, Apple fell to the sixth spot among smartphone vendors in China with approximately 9.7 million units shipped. This is a concerning trend for Apple as Chinese vendors are starting to dominate the market with innovative strategies for high-end products and strong collaborations with local supply chains.
According to Canalys, Apple is facing a “bottleneck” in the Chinese market as it tries to stabilize retail prices and protect the margins of its channel partners. In order to stay competitive in this rapidly evolving landscape, Apple will need to localize its Intelligence services in China in the next 12 months. This move is crucial as Chinese brands are aggressively incorporating generative AI into their products, enhancing the overall user experience.
During the second quarter, Vivo claimed the top spot in China with a 19% market share and 13.1 million units shipped. This success was largely driven by strong offline and online sales during the “618” e-commerce festival. Following Vivo, Oppo maintained its second-place position by shipping 11.3 million units, bolstered by the launch of its new Reno 12 series. Huawei spinoff Honor secured the third spot with 10.7 million units shipped, marking a 4% year-on-year increase. Huawei itself came in fourth with a 15% market share and 10.6 million shipment units.
Despite Apple’s decline in the rankings, the Chinese smartphone market witnessed a 10% year-on-year growth in the second quarter. Shipments exceeded 70 million units during this period, showcasing continued strength and resilience in the industry. As Chinese brands continue to innovate and expand their product offerings, Apple will need to adapt and evolve in order to regain its foothold in the highly competitive Chinese market.
Leave a Reply