China is Apple’s largest market. Rivals there include Samsung, along with several local smartphone manufacturers. Apple’s revenue can be badly damaged by slow Chinese sales, particularly of the new iPhone 15. And those sales appear to be slow. (These are the 25 biggest product flops of the past decade.)
According to CounterPoint Research, Apple’s iPhone 15 sales in China are lagging behind what they were during the first 17 days on the market for the iPhone 14. “China’s headline numbers for the 15 series are in the red, and this is a reflection of the broader decline in consumer spending,” says Mengmeng Zhang. He added that U.S. sales were robust over the same period.
Apple may no longer rely on the iPhone to drive revenue to the extent it used to, yet it remains Apple’s flagship. In the most recent quarter, iPhone sales were $38.6 billion of Apple’s total of $81.6 billion. Apple is fortunate that its Services unit has grown quickly enough to make up for a dip in iPhone demand.
Among the theories about Apple’s problems is that the iPhone 15 is too much like the iPhone 14, so customers will not upgrade. There is some support for this. The new iPhone’s camera may be better, but not to the extent that most people would care. The same is true of the iPhone’s new, faster processor
Apple also may face a large challenge from Samsung, which has been the top smartphone seller in the world for many years. Plus, Samsung has launched a new generation of foldable phones that have caught the eyes of many consumers. Early indications show sales have been brisk.
Finally, there are simply the headwinds of a slowing economy, which have been felt acutely in China. Its GDP increase rates have slowed. If so, as is true in any recession, people cut back their spending.
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