iPhone Sales Plummet in China: What’s Causing the Decline?

Political Tensions and High Prices

The latest IDC report reveals that Apple’s iPhone sales have fallen by 9% in the first quarter of 2025 compared to the previous year, with shipments dropping from 10.8 million units in early 2024 to 9.8 million. This decline has pushed Apple from third to fifth place in China’s smartphone market.

There has also been a noticeable decrease in market share, dropping from 15.6% to 13.7%. This setback has allowed Chinese brands like Xiaomi, Huawei, Oppo, and Vivo, all of which have seen growth this year, to surpass or widen their leads over the American giant.

At the top, Xiaomi leads with 13.3 million units delivered, closely followed by Huawei with 12.9 million, Oppo with 11.2 million, and Vivo with 10.3 million. Apple is the only top 5 player to experience a decline in a market that is otherwise growing.

According to IDC, several factors contribute to this slump. The ongoing geopolitical tensions between Beijing and Washington are certainly unhelpful, but the high price range of iPhones also plays a significant role. In China, the government has implemented a subsidy system to boost smartphone purchases; however, this only applies to entry-level and mid-range models. Needless to say, with units priced over 1000 euros, iPhones are in a different category.

Lack of Apple Intelligence in China

Another reason cited is the absence of Apple Intelligence on iPhones sold in China. Beyond any study, this lack of advanced features, highly anticipated by users, seems to hinder the adoption of the latest models. Even Tim Cook acknowledged this in January, stating that iPhone sales were significantly better in countries where Apple Intelligence is available. This trend is likely to continue for the recent quarter.

However, due to regulatory reasons, this technology has not yet been deployed in China (note: Chinese laws require the use of Chinese companies to develop and offer AI services). As a result, while Apple led in sales at the end of 2023, the manufacturer now struggles to compete with local competition, which is often better positioned and more nimble.

A Troubling Trend

This recent decline is part of a broader trend: Apple has been losing ground for several quarters in China, a key market that represents a significant portion of its revenue. Supported by aggressive public policies, Chinese giants are capitalizing on this opportunity to regain ground, fueled by a resurgence of technological nationalism and more competitive offerings.

The upcoming quarter is thus critical for Apple. The company must navigate the challenges associated with new tariff rates and accelerate the deployment of AI technologies. In short, Apple needs to redouble its efforts if it hopes to reverse the trend in an increasingly competitive market, both technologically and geopolitically.