In the second quarter of the year, Apple’s market share in China experienced a significant decline, dropping from 15% in the first quarter to 14%. This decline resulted in Apple falling out of the top five smartphone vendors’ list in China. The iPhone maker, which was previously the third-largest smartphone vendor in the country, dropped to the sixth position with approximately 9.7 million units shipped. This decline can be attributed to the intensifying competition from domestic brands, particularly Huawei.
According to Canalys, this is the first time in history that domestic vendors have dominated all the top five positions in the Chinese smartphone market. The strategies of Chinese brands for high-end products and their collaborations with local supply chains have started to pay off in terms of hardware and software features. Honor’s latest Magic V3, which utilizes GenAI technology, has significantly enhanced the user experience of foldable devices.
Apple is currently facing a “bottleneck” in the Chinese market as it aims to stabilize retail prices and protect the margins of its channel partners. Canalys suggests that localization of Apple’s Intelligence services in China will be a crucial move in the next 12 months, considering the aggressive incorporation of generative AI by Chinese brands into their products.
During the second quarter, Vivo reclaimed the top spot in the Chinese smartphone market with a 19% market share and 13.1 million units shipped. Oppo maintained its position in second place with 11.3 million units, while Huawei spinoff Honor came in third with 10.7 million units shipped. Huawei secured the fourth position with a 15% market share, and Xiaomi took the fifth spot. Overall, the Chinese smartphone market experienced a growth rate of 10% year on year in the second quarter, with total shipments exceeding 70 million units.
The decline of Apple in the Chinese smartphone market highlights the growing dominance of domestic brands, particularly Huawei, in the region. As Chinese vendors continue to innovate and collaborate with local supply chains, they are gradually outperforming international competitors like Apple. Moving forward, Apple will need to focus on localization and incorporating advanced technologies to regain its position in the highly competitive Chinese market.
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