Apple has continued to shed market share to local smartphone makers, including Huawei Customers shop at Apple’s flagship store in Shanghai, China, March 23, 2024 © Getty Images / Future Publishing / Contributor

Apple’s smartphone sales in China dropped 19% in the first quarter of 2024 due to increased competition from local brands, a new report by Counterpoint Research has shown.

The US tech giant fell to third place in the hotly contested market amid pressure from fast-rising rival Huawei, the researcher said on Tuesday.

The Shenzhen-based Huawei saw sales of its smartphones soar a whopping 69.7% in the first quarter. It is now the fourth-largest smartphone maker in China, according to the report.

Huawei’s strong performance comes in the wake of US sanctions, which nearly wiped out the Chinese company’s global smartphone business.

Overall, China’s smartphone market expanded about 1.5% year-on-year in the first quarter of 2024, marking the second quarter of positive growth for the industry.

Vivo became the top smartphone vendor in China during the quarter with a 17.4% share, driven by strong sales of the Y35 Plus and Y36 models in the low-end segment and the S18 in the mid-end segment. Honor ranked second with a 16.1% share, followed by Apple with a 15.7% share.

Apple loses top phone maker spot to Asian rival – data Apple loses top phone maker spot to Asian rival – data

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Apple loses top phone maker spot to Asian rival – data

“Apple’s sales were subdued during the quarter as Huawei’s comeback has directly impacted Apple in the premium segment,” senior Counterpoint analyst Ivan Lam stated. “Besides, the replacement demand for Apple has been slightly subdued compared to previous years.”

The sales drop highlights the challenges Apple faces in its third-largest market, where some Chinese companies and government entities bar the use of its devices in retaliation to restrictions the US placed on Chinese apps for supposed security reasons.

Analysts anticipate increased pressure on Apple’s sales in 2024. Research firm IDC previously warned that the US tech giant’s presence in China has been dented by rival products and limited product upgrades by Apple, which has reduced the overall attractiveness of iPhones.

Apple, once the world’s most valuable company, has seen its shares fall 14% this year, underperforming the overall market. Its market valuation is still $2.56 trillion, second only to Microsoft Corporation.

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