Apple has encountered a tough first quarter in China, with its iPhone shipments falling by 9% compared to the previous year. According to recent data from IDC, Apple shipped 9.8 million iPhones in the first quarter, resulting in a market share drop to 13.7%, down from 17.4% last quarter.
During the same period, China’s overall smartphone market saw a 3.3% growth, underscoring Apple’s unique struggle among major brands. Xiaomi led the charge with a significant 40% increase in shipments, reaching 13.3 million units, securing the top position in the market.
Pricing Strategy to Blame for Declining Sales
IDC analysts point to Apple’s premium pricing as a major factor behind its sales slump in China. At the start of the year, the Chinese government introduced new subsidies that offered a 15% refund on electronics priced under 6,000 yuan (approximately $820). While the iPhone 16 base model is priced at 5,999 yuan, it just barely qualified for the subsidy, making it less appealing to cost-conscious shoppers.
On the other hand, local brands like Xiaomi, Oppo, and Vivo were better positioned to take advantage of the subsidy, offering more affordable options and capturing a larger share of the market.
Apple’s Struggles in a Competitive Market
This marks the seventh straight quarter of declining iPhone shipments in China, highlighting the ongoing challenges Apple faces in the world’s largest smartphone market. Even slight price differences can have a major impact on consumer decisions, especially in such a competitive landscape.
Despite remaining the leader in the global premium smartphone sector, Apple’s ability to adapt to local market conditions in China will be crucial if it hopes to recover lost ground. With strong local competitors continuing to grow, Apple’s market share could face further pressure if adjustments aren’t made.
As 2025 progresses, Apple will need to consider how it can adapt its pricing strategy to meet the evolving dynamics of the Chinese market if it hopes to reverse its fortunes in this key region.