Jaap Arriens | Nurphoto | Getty Images
Apple is losing market share in China as iPhone shipments decline, supply chain analyst Ming-Chi Kuo wrote in a report Friday. Shares fell 2.4%.
“Apple has taken a cautious stance while discussing iPhone production plans for 2025 with key suppliers,” wrote Kuo, an analyst at TF Securities post. He added that despite the expected launch of the new iPhone SE4, shipments are expected to decline by 6% year-on-year in the first half of 2025.
Kuo expects Apple's market share to continue to decline because two of its upcoming iPhones are so thin that they will likely only support eSIM cards, something the Chinese market does not currently promote.
“These two models may face transportation dynamics challenges unless their design is modified,” he wrote.
Kuo wrote that overall smartphone shipments in China remained flat in December compared to a year earlier, but iPhone shipments fell by 10-12%.
There is also “no evidence” that Apple Intelligence, the company's device artificial intelligence According to Kuo, it increases revenues from hardware or service upgrades. He wrote that the feature “did not increase demand for iPhone replacements,” according to his supply chain survey, and added that he believed the feature's attractiveness “has declined significantly compared to cloud-based AI services that have rapidly developed in the coming months.”
Kuo wrote that Apple's estimated iPhone shipments in 2024 will be about 220 million units and between about 220 million and 225 million this year. That's “below the market consensus of $240 million or more,” he wrote.
Apple did not immediately respond to a request for comment.
