The first quarter of 2024 has revealed a significant shift in China’s smartphone market dynamics. iPhone sales in China dropped by a concerning 19%, while Huawei experienced a surge, with sales rising by an astounding 70% during the same period. This unexpected shift has placed the focus on Huawei’s comeback strategy and its impact on Apple’s dominance in the premium segment.
According to Counterpoint’s latest report, Huawei’s revival in the smartphone market is largely credited to its new Mate 60 series, a high-end device featuring advanced 5G technology. Huawei’s return to the 5G smartphone market has energized its customer base, allowing it to regain significant market share in China. This is an impressive recovery for a brand that faced U.S. sanctions and struggled with limited access to crucial technology components.
Despite Apple’s setback in China, experts suggest the brand could bounce back with a series of strategic moves. Lam, a senior analyst at Counterpoint, points to the potential impact of new color variants, aggressive pricing, and the upcoming launch of artificial intelligence features in Apple’s smartphones. The annual Worldwide Developers Conference (WWDC), scheduled for June, could be a turning point, with the introduction of innovative AI applications.
Smartphone sales in China overall have shown slight growth, rising 1.5% year-over-year, driven by the New Year’s holiday season and demand for budget smartphones. Huawei’s re-entry into the premium segment is also contributing to this growth, capturing a larger portion of the market. While Huawei’s resurgence is good news for Chinese consumers, it’s a direct challenge for Apple’s market share, forcing the Cupertino-based giant to rethink its strategies for regaining momentum.
The competitive landscape in China has never been tighter, with only a 3% point difference separating the top six players. Huawei’s resurgence, along with strong performances from other Chinese OEMs like HONOR and vivo, sets the stage for a fiercely contested market in the coming months. As Apple seeks to regain its footing, all eyes are on its upcoming announcements and the strategies it employs to recover from this downturn.
For a detailed analysis of the smartphone market in China, read the full report from Counterpoint here.