Apple is facing a challenging year as iPhone shipments are projected to decline by 10% to 15% in 2024. Analyst Ming-Chi Kuo attributes the decline primarily to reduced demand in the Chinese market, where local manufacturers like Huawei are gaining a stronger foothold. As of early 2024, Apple has dropped to fourth place in market share in China, overtaken by Vivo, Huawei, and Honor.
The decrease in shipments is part of a broader trend affecting the global smartphone industry, with Apple experiencing significant setbacks. Contributing factors include the growing popularity of smartphones with generative AI and foldable designs, areas where competitors are currently outpacing Apple. Although Apple plans to introduce these technologies in future models, they are not expected to impact the market until 2025.
Analyst Ming-Chi Kuo has highlighted that the iPhone 16 did not present substantial upgrades to entice consumers, which, combined with the strength of competitors like Huawei, has led to a significant decline in Apple’s market presence in China. This decline is compounded by the growing interest in foldable devices and advanced AI-driven smartphones, areas where Apple has not yet made significant inroads.
Financially, Apple’s stock has also felt the impact, with a noticeable drop following these reports. Despite the downturn, analysts like those from Wedbush Securities remain optimistic about Apple’s long-term performance, banking on pent-up demand for future iPhone models to rebound sales.
While Apple’s shipments in China and globally are declining, other manufacturers, particularly Samsung, are seeing increased shipments thanks to innovative features like AI, which are currently absent from Apple’s offerings.
This downturn comes amid other strategic shifts within Apple, including the cancellation of the Apple Car project, which redirects focus and resources toward enhancing AI capabilities in its product lineup.
This series of setbacks suggests Apple may need to accelerate innovation and adapt to shifting market demands to maintain its competitive edge and market position.
