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Pressure From Rivals Causes Apple to up Discounts on iPhones in China

Apple Retail Preps for Home Delivery

Apple has reportedly begun a campaign of heavy discounting on its iPhone in China.

The markdowns — up to 2,300 yuan (about $320) on select iPhone models on the company’s Tmall site — come as Apple faces increased competition from local tech companies like Huawei, Reuters reported Monday (May 20). Last month, Huawei debuted its latest smartphone model, the Pura 70.

The sale — which lasts until May 28 — is larger than the one offered in February, when Apple was giving discounts of about half of its current offering, the report said. The previous discounts seem to have helped the tech giant offset cooling sales in China.

Apple CEO Tim Cook noted during an earnings call earlier this month that the company’s iPhone sales in China had grown during the prior quarter.

“We still saw growth in the iPhone in some markets, including mainland China,” Cook said, as sales from the greater China market declined 8% from a year ago.

In response to analysts’ questions about China, Cook said: “What we saw was an acceleration from Q1, and it was driven by iPhone. … The other products didn’t fare as well, and so we clearly have work there to do. I think it has been and is, through last quarter, the most competitive market in the world.”

Apple has spent the past year battling to bolster its business in China as it faces rivals such as Huawei as well as a ban on iPhone use by employees of state agencies and government-owned companies.

Meanwhile, PYMNTS’ Karen Webster examined the state of Apple earlier this month in the wake of the company’s most recent earnings report.

She outlined the various setbacks the company has faced in categories like wearables, the Vision Pro and its connected car project.

“Unless Apple has another transformative product innovation hiding up its sleeves, Apple’s growth is entirely dependent upon people buying the next generation of iPhone, upgrading them and using them,” Webster wrote. “The same form factor, more or less, that they have been buying for the last 17 years.”