Apple’s China Troubles Continue With 18% iPhone Sales Drop

Apple reportedly closed out 2024 suffering a double-digit drop in iPhone sales in China.

Sales of the company’s flagship product were down 18.2% in China during the last quarter of the year, Bloomberg News reported late Monday (Jan. 20), citing Counterpoint Research data. It was the latest example of Apple’s struggle in China, its biggest market outside the U.S.

According to the report, iPhones — which had been the number one phone in China this time last year — fell to third place, with China’s Huawei taking the number one spot.

“This is the first time since the U.S. ban that Huawei regained the leading position,” Counterpoint analyst Mengmeng Zhang said. “Huawei’s sales increased 15.5% YoY driven by the launch of the mid-end Nova 13 series and high-end Mate 70 series.”

This follows similar Counterpoint research from last week showing that iPhone sales had fallen 5% last year amid stronger competition, and a lack of Apple’s artificial intelligence (AI) features on phones sold in China.

Apple has been slower to roll out its AI offerings compared to its competitors, introducing its Apple Intelligence suite following the debut of the iPhone 16 in September.

The company has not been able to add AI features to iPhone 16s sold in China due to local restrictions. China’s government requires generative AI operators to secure permission before they can roll out a product. That’s left Apple trying to land partnerships with Chinese companies to introduce its AI feature.

Apple is also facing pressure in another major smartphone market, with Indonesia banning the iPhone due to that country’s content restrictions. The company had proposed making a $1 billion investment in local manufacturing, but Indonesia’s government said that wasn’t enough to meet a regulation that requires 40% of all content in devices to be sourced in-country.

As noted here last year, experts argue the company’s embrace of AI technology could transform how people shop, while also pushing back against the idea that Apple is lagging in Big Tech’s AI race.

“Apple may be late to the AI surge compared to Google and Amazon, which have been adding AI to products for years,” The Big Phone Store CEO Steven Athwal said in an interview with PYMNTS. “But Apple has always been about timing and refinement. While others rushed to put out the latest in AI tech, Apple focused on privacy, security and user experience.”