CareCredit - Women's Health April 2024

Apple Marks Down iPhones in China Amid Waning Demand

iPhones in China

Apple is offering Chinese customers discounts of as much as $70 on its latest iPhones.

The three-day sale was announced on the company’s Chinese website Monday (Jan. 15) and comes as the tech giant is facing slowing demand for its flagship product.

A report by Bloomberg News called the move to offer discounts on the latest iPhone models a rare one, and argued it could strengthen fears about the decline in demand.

Last week saw a report by analysts from Jefferies that iPhone sales in China had fallen by 30% for the first week of 2024. That decline was the primary factor fueling a nationwide, double-digit drop in smartphone shipments in China, and happened despite significant markdowns on several iPhone models.

The Jefferies analysts contended that Apple will face more pressure from rivals throughout this year, forecasting that the company’s shipment volumes in China will continue falling by double digits in 2024, while homegrown competitor Huawei expands its market share.

Earlier this month, Barclays forecast ongoing weak demand for the iPhone, leading the company’s stock to drop and erasing more than $107 billion in market value.

“We expect reversion after a year when most quarters were missed and the stock outperformed,” the bank’s analysts wrote in a note. “Our checks remain negative on volumes and mix for iPhone 15, and we see no features or upgrades that are likely to make the iPhone 16 more compelling.”

Apple’s market value hit $3 trillion in 2023 as investors banked on the idea that consumers would keep purchasing iPhones. Since then, however, Apple has run into an uptick in competition from rivals such as Huawei, as well as restrictions in China on iPhone use by government or state-owned company workers.

Meanwhile, Apple is preparing to launch its Apple Vision Pro mixed-reality headset, with pre-orders for the $3,500 product scheduled to begin this week. The Vision Pro is set to arrive in stores in February.

“This move is significant as the company ventures into the world of mixed reality, which combines virtual and augmented reality,” PYMNTS wrote in December.

“While Meta Platforms currently dominates the market, Apple is determined to make a strong first impression with its offering.”

As that report noted, the rollout of the Vision Pro is a major endeavor, requiring new sales strategies and equipment, as the headset features customized components that must be correctly assembled and packaged at the point of sale.