Apple experiencing subdued demand in China after Huawei's robust comeback
What's the story
Apple's iPhone demand in China has reportedly dropped, especially for the iPhone 14 Pro and Pro Max. This is probably due to Huawei's strong comeback in China and labor protests last November. Analyst Ming-Chi Kuo noted Foxconn supply chain issues caused a 12 million unit reduction (abovementioned models) in November 2022, leading to a lower revenue baseline for 4Q22. But Apple expected its 4Q23 revenue also to be similar to 4Q22, indicating a slower momentum triggered by China's demand decline.
Details
Strategy amid Huawei's resurgence and regulatory challenges
Huawei's resurgence is causing structural changes in China's market, further impacting Apple's shipments. However, CEO Tim Cook reportedly remains positive about Apple's performance in China. He cited a "record-setting sales quarter" in September and emphasized the company's commitment to the Chinese market. Moreover, to compete with Huawei's Mate 60 Pro and address regulatory challenges, Apple has reduced iPhone 15 series prices on e-commerce platforms and continues to innovate to attract more consumers in China.
Scenario
Apple's global market share and expansion in India
Globally, however, Apple leads in terms of market share and is ahead of Samsung. In India, meanwhile, the company reported its highest-ever quarterly growth, shipping over 2.5 million iPhones. This marks a 34% year-on-year growth. The surge could be attributed to consumers' interest in premium smartphones, fueled by attractive offers and financing options. Apple aims to expand its market share in India from 4.5% to 6% through market focus and local production initiatives.