Apple's Aggressive Discounts Fail to Stem Market Share Loss in China

Apple's aggressive discounting campaign in China has failed to stem market share losses, with the company's market share standing at 11% in May.

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Despite offering significant discounts on its official Tmall site in China, Apple has reportedly lost market share in the country. According to a report by UBS, Apple’s market share in China stood at 11% in May, with iPhone sales climbing only 0.9% year over year.

Chinese smartphone market continues to grow

The report suggests that while Apple’s sales may have seen a slight increase, the overall market in China grew 11% year over year, indicating that the company’s market share has actually decreased. This is a worrying sign for Apple, as China is a crucial market for the tech giant.

iPhone sales struggle to keep up with market growth

UBS analyst David Vogt noted that Apple’s loss of market share to Huawei and other Chinese OEMs will act as a material governor on iPhone unit growth. This is a significant concern for Apple, as it struggles to maintain its market share in the face of intense competition from local players.

Huawei continues to gain ground on Apple in China

The report also highlights that iPhone sales in the US were down 16% year over year, while the overall smartphone market was down 10%. This suggests that Apple is struggling to maintain its market share in its home market as well.

iPhone sales decline in the US

However, there is some respite for Apple in Europe, where iPhone sales were up 19.5% year over year, although this is still below the overall 21% rise in the market.

iPhone sales show some growth in Europe

The findings of the report are a setback for Apple, which had been hoping to stem its market share losses in China through aggressive discounting. However, it seems that the company’s efforts have not been enough to counter the strong competition from local players.

Discounts fail to stem market share losses

The report highlights the challenges that Apple faces in maintaining its market share in China, and the need for the company to rethink its strategy in the country.

“While Apple bulls may note the data is backwards looking and is not likely indicative of Apple’s AI smartphone opportunity next year, we note that iPhone share loss to Huawei and other Chinese OEMs acts as a material governor on iPhone unit growth.” - David Vogt, UBS analyst

Apple’s AI smartphone opportunity next year

The article highlights the intense competition that Apple faces in the Chinese smartphone market, and the need for the company to innovate and adapt to changing market conditions.