Apple slips 4% following report of losing China market share lead

Chinese smartphone makers Vivo and Huawei are taking a bite out of Apple’s market share on the Mainland. Following today’s research report from Canalys showing that Apple market share in China fell all the way down to third place in 2024, shares of of the U.S. tech giant were down 4% and trading at their lowest level since mid-November.

GROWING COMPETITIVE PRESSURE:

According to a research report published today by Canalys, Apple shipped 13.1M units in Q4 – typically, its peak season – and for the quarter, the U.S. tech giant retained its China leadership position in terms of shipments with 17% market share. Vivo’s 12.9M, Huawei’s 12.9M, and Xiaomi’s 12.2M unit shipments place those companies in second, third, and fourth positions. The rub is in the rate of change: while the aforementioned Chinese firms’ annualized Q4 growth rates were up 14%, 24%, and 29%, Apple’s shipments were down 25%.

The data for the calendar 2024 crystallizes Apple’s troubles in China. Vivo’s overall shipments for last year were up 11% to 49.3M units and Huawei’s shipments grew 37% to 46.0M devices. Apple, meanwhile, saw its iPhone shipments for the year fall 17% to 42.9M units, and its market share has fallen to 15% from 19% at the end of 2023. Vivo’s market share now leads Chinese manufacturers at 17% and Huawei is in second place at 16%.

Amber Liu, a research manager at Canalys, opined: “Intense competition has led to a constantly shifting landscape, with vendors actively seeking to expand investments in their advantageous field… Apple and its iPhone 16 series maintained the top spot in Q4 but faced growing competitive pressure from domestic flagship devices.”

APPLE’S HIGH-END POSITIONING A DETRIMENT IN 2025: Canalys Smartphone Market Pulse data showed the overall 2024 smartphone shipments growing 4% to 284.6M devices, and the research firm predicts that smartphone shipments in Mainland China will exceed 290M units in 2025. “Mainland China enjoys a uniquely favorable market environment in the global market, supported by an anticipated steady demand recovery, a stable and improving macroeconomic environment and healthy channel operations”, commented Lucas Zhong, Research Analyst at Canalys. Apple’s competitive positioning in China will not get any easier this year however. Last week, the researchers at Canalys concluded that while the expansion of the national subsidy program by Chinese government from support of household appliances to include smartphones, tablets, and wearables would benefit the cheaper local brands, Apple’s premium Pro models are exempt from the trade-in subsidy due to their high cost.

PRICE ACTION / MAG-7 WEAKEST LINK: Apple shares were under considerable pressure following the report, losing 4% on the session to trade below the $230 level – the lowest point for the stock since November 22. Apple is also the worst performer among its Magnificent-7 peers by a wide margin. In the first 10 trading sessions of 2025, shares of Apple are down by about 9%. Nvidia is the only other name in the MAG-7 group with a negative return thus far this year, though its decline is a marginal 0.5%.