Apple iPhone Shipments Decline 10% Despite Smartphone Industry Rebound

(CTN News) – Apple Inc’s iPhone shipments fell more than expected in the March quarter, indicating slowing sales in China despite a broader smartphone industry comeback.

According to IDC’s preliminary numbers, the business shipped 50.1 million iPhones in the first three months, falling short of Bloomberg’s average analyst projection of 51.7 million handsets.

The Cupertino, California-based corporation has battled to maintain sales in the world’s largest smartphone market since the release of its current iPhone generation in September.

The return of Huawei Technologies Co., increased domestic rivalry, and Beijing’s prohibition on foreign devices in the workplace have all affected sales.

The fall is especially pronounced given that the entire mobile market is experiencing its best growth in years. Smartphone manufacturers shipped 289.4 million phones during the period, a 7.8% increase from the previous year’s low, when many manufacturers were dealing with an excess of unsold devices.

Samsung Electronics Co reclaimed the top spot in the March quarter, while budget-conscious brand Transsion increased shipments by 85%, and Xiaomi Corp recovered to cut the gap on second-place Apple.

“The smartphone market is emerging from the turbulence of the last two years stronger and changed,” said Nabila Popal, IDC’s research director. While the top two players both saw negative growth in the first quarter, it seems Samsung is in a stronger position overall than it was in recent quarters.”

Prominent Apple suppliers Hon Hai Precision Industry Co, Murata Manufacturing Co, LG Innotek Co, and TDK Corp tumbled in early Asia trading on Monday, part of a broader selloff fueled by fears of rising unrest in the Middle East.

During the pandemic, Apple’s iPhone showed the best resiliency as buyers shied away from purchasing smartphones from most of its Android-powered competitors.

That inventory accumulation prompted aggressive pricing from Chinese competitors such as Xiaomi, which took months to exhaust their surplus and is now beginning to ramp up shipments again.

Huawei’s unexpected comeback to prominence last year, with its own made-in-China silicon and HarmonyOS operating system in the Mate 60 series, has eroded Apple’s share of China’s premium market since August.

“Increased competition in China is a big part of Apple’s decline in Q1,” he said. In addition, a lot of regions began the year with excess iPhone inventory following large shipments in the last months of 2023, she explained.

According to IDC experts, average selling costs for handsets are rising as buyers increasingly choose premium models that they expect to keep for longer periods.

Apple, which constantly maintains the industry’s highest ASP, has led the way in this, with consumers indicating a clear preference for its higher-tier devices.

Nonetheless, the corporation has used extraordinary discounts to boost sales this year, with some retail partners in China offering up to US$180 (RM859) off the regular price.

In March, Apple launched a big new store in the heart of the financial metropolis of Shanghai, with CEO Tim Cook in attendance. China is home to the company’s largest retail network outside of the United States, accounting for nearly one-fifth of sales, which the iPhone still leads.

However, many of the visitors who talked with Bloomberg at the Shanghai shop launch had purchased their iPhones more than two years prior.

While those Apple supporters stated that they wanted to stay within the Apple ecosystem, some indicated they were also investigating foldable device options from competitors, such as Huawei’s Mate 60 successor.