Counterpoint: China's overall smartphone market sales fell 7% year-on-year in the first six weeks of 2024

According to the latest weekly sales tracking report on the Chinese smartphone market released by market research firm Counterpoint Research, the overall sales of the Chinese smartphone market in the first six weeks of 2024 fell by 7% compared with the same period last year, with Apple's sales falling by 24% year-on-year and Huawei's sales rising by 64% year-on-year.

Although in the global smartphone market in 2023, Apple's iPhone shipments surpassed Samsung for the first time to become the world's number one smartphone manufacturer, in the Chinese smartphone market, Apple suffered a sharp decline due to the return of the Huawei Mate 60 series equipped with Kirin processors.

Data previously released by TechInsights also showed that in the fourth quarter of 2023, Apple's shipments in the Chinese smartphone market fell 14.6% year-on-year to 14 million units.

According to Apple's first quarter financial report for fiscal year 2024 ending December 30, 2023 (the fourth quarter of natural year 2023), Apple's revenue in the quarter increased by 2% year-on-year to US$119.575 billion, ending the past four consecutive quarters of year-on-year revenue decline, and both operating profit and earnings per share hit record highs.

However, Apple's revenue in Greater China (including mainland China, Hong Kong, China, and Taiwan) fell 12.9% year-on-year, which is the only region among all Apple's major sales regions where revenue declined year-on-year.

It is also Apple's weakest performance in Greater China during the same period since the first fiscal quarter of fiscal year 2020.

Apple CEO Tim Cook explained in an interview that the first quarter of fiscal year 2024 will only have 13 weeks, compared with 14 weeks in the same period last year. In addition, the appreciation of the US dollar against the RMB has had an adverse impact on Apple's sales in China.

However, he remains optimistic, saying that Apple accounts for four of the top six best-selling smartphone models in urban areas of China.

However, performance analysis believes that Apple's revenue in Greater China has declined sharply because sales of the iPhone 15 series in the Chinese market have been affected by the hot sales of Huawei's Mate 60 series launched at the end of August last year, and this impact is still continuing.

According to data released by Counterpoint Research, although the overall sales volume of China's smartphone market fell by 7% year-on-year in the first six weeks of 2024, Huawei's shipments rose by 64% year-on-year. In contrast, Apple's iPhoen sales fell sharply by 24% year-on-year.

Zhang Mengmeng, a senior analyst at Counterpoint Research, also pointed out that Apple's iPhone has been affected by the strong return of Huawei's Mate 60 series in the high-end smartphone market. At the same time, the mid-range market has also been affected by fierce price wars among brands such as OPPO (excluding OnePlus), vivo and Xiaomi. Although the iPhone 15 series is an excellent mobile phone, due to the lack of significant upgrades compared to its predecessor, Chinese consumers have no obvious motivation to change their phones and are still using the previous generation of iPhones or have turned to the Huawei Mate 60 series.

△Note: Comparative data is based on January 2 to February 12, 2023 and January 1 to February 11, 2024; due to rounding, OEM shares may not add up to 100%; OPPO does not include OnePlus.

It is worth noting that in the first six weeks of this year, the sales of smartphones of OPPO (excluding OnePlus) and vivo also fell sharply, by 29% and 15% respectively. Xiaomi also saw a year-on-year decline of 7%.

Apart from Huawei, only Honor achieved year-on-year counter-cyclical growth of 2%.

Counterpoint Research explained that the sharp year-on-year decline in shipments by leading smartphone manufacturers in the first six weeks of this year was partly due to the abnormally high sales in the first six weeks of 2023. Since some manufacturers delayed production in December 2022, sales were not included until early 2023, which also made the year-on-year changes in the year-on-year figures more obvious.

Ivan Lim, senior analyst at Counterpoint Research, said that overall growth in the first quarter of 2024 will still be slow due to weak spending in the Chinese market and the launch of a few new products.

Huawei's Mate 60 series continues to drive strong demand, which is a bright spot in the smartphone market in early 2024. As for Apple, there are many ways to improve in the short term, such as weekend promotions, which is the most classic approach.

However, a research report released by Tianfeng Securities analyst Ming-Chi Kuo at the end of January this year was pessimistic about the future sales performance of the iPhone. He predicted that due to structural challenges, iPhone shipments this year may drop by up to 15% year-on-year, and may lag behind mobile phones that introduce AI technology and foldable screen phones.

In the Chinese market, weekly iPhone shipments have decreased by 30% to 40% year-on-year.

Chip Intelligence