iPhone Shipments in China See a Sharp Decline in December 2024
Apple’s iPhone sales in China have taken a notable hit, according to a new market report by prominent analyst Ming-Chi Kuo. The report reveals that Apple’s year-over-year sales in December 2024 dropped by 10-12% compared to the same period in 2023. This marks a significant challenge for Apple in one of its most critical markets and highlights growing concerns about the company’s ability to maintain its dominance in the global smartphone industry.
Lack of Innovation Behind Declining Sales
Ming-Chi Kuo attributes the decline in iPhone sales in China to a perceived lack of innovation in Apple’s latest offerings. The iPhone 16 series, launched in September 2024, has failed to excite Chinese consumers, largely due to its minor improvements over the previous iPhone 15 series.
Chinese customers, known for their appetite for cutting-edge technology and value-packed features, have shown lukewarm interest in the incremental upgrades offered by the iPhone 16 lineup. This stagnation in innovation is seen as a key factor in Apple’s declining market share in the region. Kuo’s report emphasizes that Apple’s competitors, such as Xiaomi, Huawei, and Vivo, have been quick to capitalize on this opportunity by launching devices with more advanced features at competitive prices.
Stable Market Conditions Expose Apple’s Struggles
Interestingly, the overall smartphone market in China remained stable throughout December 2024, further highlighting Apple’s underperformance. Unlike during the COVID-19 pandemic years or periods of economic uncertainty, the broader market did not experience significant fluctuations. This stability underscores that Apple’s struggles are specific to its product lineup and strategy, rather than a reflection of broader market conditions.
Competitors like Huawei have also regained momentum in the Chinese market, thanks to their innovative products and a renewed focus on high-end smartphones. Huawei’s Mate 60 Pro series, for instance, has garnered significant attention for its advanced satellite connectivity features and improved AI capabilities. Xiaomi and Vivo, too, have continued to attract consumers with feature-rich devices that offer better value for money compared to Apple’s premium-priced iPhones.
A Bleak Outlook for Early 2025
Looking ahead, Ming-Chi Kuo’s outlook for Apple’s performance in the first half of 2025 remains grim. He predicts further declines in sales, with the upcoming launch of the iPhone SE4 unlikely to reverse the trend. While the iPhone SE lineup has traditionally served as a more affordable entry point into Apple’s ecosystem, its impact on overall sales has been limited.
The iPhone SE4 is expected to feature modest hardware upgrades, but it may struggle to attract a significant number of new buyers in China, where budget-conscious consumers often gravitate toward Android devices that offer better specifications at similar or lower prices. Additionally, the SE series typically appeals to a niche audience, limiting its potential to offset broader declines in iPhone sales.
Challenges for the iPhone 17 Series
Ming-Chi Kuo also casts doubt on the prospects of the iPhone 17 lineup, expected to launch in late 2025. Rumors suggest that Apple plans to exclusively rely on eSIM technology for the new series, eliminating the physical SIM card slot entirely. While eSIM adoption has been growing globally, it remains a contentious issue in China.
Not all Chinese carriers currently offer eSIM support, which could create significant hurdles for consumers looking to upgrade to the iPhone 17 series. This move, while innovative, may alienate a substantial portion of Apple’s customer base in China, further dampening sales prospects in the region.
Kuo’s analysis also raises concerns about the broader implications of Apple’s eSIM strategy. While eSIM technology offers benefits such as easier carrier switching and improved water resistance for devices, it requires widespread carrier support and consumer education. In markets like China, where carrier practices and consumer habits vary significantly from those in the U.S. and Europe, the transition could prove challenging.
Global iPhone Sales Modest Growth, Missed Expectations
Globally, Apple is expected to ship 225 million iPhones in 2025, a modest increase from the estimated 220 million units in 2024. However, this figure still falls short of the 240 million units that analysts had previously anticipated. The slower-than-expected growth underscores Apple’s challenges in maintaining its competitive edge in a rapidly evolving smartphone market.
Apple’s struggles are not limited to China. In other markets, the company faces increasing competition from Android manufacturers, many of which are offering devices with better hardware, innovative features, and more competitive pricing. Additionally, economic pressures in various regions have made consumers more price-sensitive, further impacting Apple’s premium-priced products.
The sharp decline in iPhone sales in China during December 2024 serves as a wake-up call for Apple. As competitors continue to innovate and capture market share, Apple must address its perceived lack of innovation and adapt its strategy to better align with consumer expectations, particularly in key markets like China.
The company’s upcoming product launches, including the iPhone SE4 and iPhone 17 series, will be critical in determining whether Apple can reverse its fortunes in 2025. However, with significant challenges such as limited eSIM adoption and stiff competition from rivals, the road ahead is fraught with uncertainty. As Ming-Chi Kuo’s report highlights, Apple’s ability to innovate and adapt will be crucial in maintaining its position as a leader in the global smartphone industry.