Shipments of foreign-branded smartphones to China, including Apple’s (AAPL) iPhone, declined by 47.4% year-over-year in November, according to data from a Chinese-government affiliated research firm. Furthermore, the data from the China Academy of Information and Communications Technology (CAICT) showed that overall, shipments of foreign brands to China fell to 3.04 million units in November, from 5.769 million units in the same period a year back.
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This sharp decline follows a 44.3% year-over-year drop in foreign smartphone shipments in October, highlighting the ongoing challenges in the world’s largest smartphone market. Overall, domestic and foreign smartphone shipments within China declined by 5.1% in November, with total handset shipments falling to 29.61 million units.
AAPL Is Facing Mounting Challenges in China
Apple is facing mounting pressure in China due to a slowing economy and intensifying competition from domestic rivals like Huawei. In November, Chinese consumer prices hit a five-month low, reflecting economic uncertainty and deflation concerns that continue to weigh on household spending.
To boost its market share in China, Apple launched a rare four-day promotion, slashing prices on its flagship iPhone models by up to 500 yuan ($68.50) in a bid to boost sales. However, Huawei’s resurgence in the premium smartphone segment, driven by locally made chipsets, has strengthened its position as a formidable competitor.
The bleak outlook for AAPL’s iPhone sales in China has prompted UBS analyst David Vogt to lower his iPhone sales estimates for the December quarter.
Is Apple a Buy, Sell, or Hold?
Analysts remain cautiously optimistic about AAPL stock, with a Moderate Buy consensus rating based on 19 Buys, eight Holds, and two Sells. Over the past year, AAPL has surged by more than 30%, and the average AAPL price target of $245.99 implies an upside potential of 0.9% from current levels.
