Apple's iPhone Sales Are Said To Be Under Threat

Huawei's new 5G smartphone, the Mate 60 Pro is potentially posing a serious threat to new iPhone sales in China, it has been reported.

 

That is, according to analysts at Jefferies, who said in a note this week that "Chinese consumers see it as a big win over US sanctions". They estimate the Mate 60 could eat into as much as 38% of iPhone sales in China. 

 

Apple CEO Tim Cook (above) who was in the country in March reportedly said at the time: "Innovation is developing rapidly in China, and I believe it will further accelerate". He was right, but probably didn't foresee what it might cost his company. 

 

After all, the country has been a hugely important market for Apple, which generated almost a fifth of their $394.3 billion net sales in their most recent fiscal year.

 

And with less than a week to go before the release of the iPhone 15, there should be a huge buzz around Apple as they prepare for the biggest event in their calendar year. Instead, they're having to nurse a sudden $200 billion drop in market value, amid investor concerns about China as well as fears of a government crackdown on iPhone use among government employees.

 

This "news" and Huawei's new launch are signalling that the new iPhone may not fly off the shelves. Already, the Mate 60 Pro is expected to help Huawei recapture lost ground in China. 

 

Linda Sui, a senior smartphone analyst with TechInsights pronounced that “Huawei’s strong return will have a huge impact on China’s smartphone market in the second half and in 2024, with more impact on other Android-based phone brands vying for the high-end Chinese smartphone market”. 

 

But she added that although Huawei may reshuffle the top five smartphone brand rankings in China, they pose less of a threat to Apple because the brands have different target client bases. 

 

According to data from consultancy firms IDC and Counterpoint, Chinese smartphone shipments dropped to 286 million units in 2022, with Huawei ranking sixth with a market share of only 7.9 percent, after Vivo, Apple, Oppo, Honor and Xiaomi. This is a big change from Huawei's heyday, when they led the China market for four consecutive years from 2017 to 2020.

 

Still, the Mate 60 Pro model is being seen by some analysts as a potential savior for Huawei, with sales surging on both online and offline channels. 

 

Anyway, we will know how Apple's iPhone 15 is going to fare soon enough!