In the latest report from research firm IDC, Apple (NASDAQ:AAPL) emerged as the world’s leading smartphone seller, surpassing Samsung Electronics in the previous year. Apple’s iPhone, contributing to 20% of the global market in 2023, witnessed nearly 235 million shipments, outpacing Samsung Electronics, which experienced a more than -10% decline in smartphone shipments to 226.6 million. This marked the first time since 2010 that Samsung lost its position as the top seller in smartphone sales.

Apple’s commanding presence in the smartphone market indicates its ability to navigate a downturn in the industry more effectively than its competitors. Despite a lukewarm reception for its new iPhone 15 in China, Apple managed to sustain iPhone sales momentum. The tepid response was partly due to a widening government crackdown on foreign electronic devices in China, boosting sales for local players like Huawei Technologies and Xiaomi Corp.

Global iPhone sales in 2023 received a boost through aggressive offers from Apple, luring buyers toward its premium devices. The company achieved a +3.7% growth in smartphone sales, standing as the sole player among the top three global smartphone makers to register growth last year. IDC attributes this positive trend to Apple’s success in the premium device category, which now commands over 20% of the market. Attractive trade-in offers and interest-free financing played a role in driving this shift up in the smartphone price chain.

However, despite Apple’s triumph in claiming the top spot in global smartphone sales, it has not remained entirely immune to the broader decline in the market. Sales of the iPhone 15 in China lag behind its predecessor, the iPhone 14, and analysts predict a further decline in Apple’s iPhone sales in the Chinese market. Jeffries reported a double-digit fall in sales volume for Apple in December and anticipates a similar decline in 2024. Discounts on Apple’s smartphone range have increased across various online platforms, impacting the average selling price without stimulating volume growth.

To counter weak demand in China, Apple recently announced discounts of up to 5% on its newer iPhones, marking the first time it has offered such concessions in the Chinese market in years. A key challenge for Apple is the intensified competition from Huawei Technologies, which gained popularity in China after the government widened its ban on the use of Apple products. Huawei’s release of the Mate 60 Pro smartphone, powered by a new domestically produced system processor, led to patriotic sales in China, allowing the company to regain customers lost to Apple. Jeffries estimates Huawei shipped 35 million smartphones in 2023, with supply constraints limiting the potential for higher numbers.

Featured Image: Unsplash

Please See Disclaimer