Apple's iPhone no longer enjoys the highest smartphone market share in China

Apple's iPhone no longer commands the biggest market share in China's smartphone market, as the position has now been taken up by Huawei. China's smartphone sales have grown positively year-on-year, driven mainly by double-digit growth in Android device sales led by Huawei, Xiaomi and Honor devices. Apple's iPhone however, has seen a double-digit decline in sales. Its volume growth year-on-year has been negative since the iPhone 15 launched. 

“We believe weak demand in China would eventually lead to lower-than-expected global shipments of iPhone 15 in 2023,” according to Jefferies analysts. It added that the trend suggests the iPhone will “lose” to Huawei next year, said the Jefferies note. 

The analysts noted that resale iPhone 15 devices are all “trading at discounts to official selling prices”. This also reflects the weak demand in China. 

Additionally, analysts at Morgan Stanley cut their price target for Apple from $215 to $210 in its report, while cutting their iPhone expectations for the quarter by 8%. The analysts said they are now “more guarded” about the company’s December quarter because of supply headwinds.  

The Morgan Stanley analysts said they will be watching Apple’s total revenue, services revenue growth, gross margin and revenue growth in China from its September quarter, but that the December quarter guide “is what will matter most.”