Without China, the iPhone 16 Can’t Be a Success

By Douglas A. McIntyre Published Sep 9, 6:40AM EDT

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Without China, the iPhone 16 Can’t Be a Success — © 2023 Getty Images / Getty Images News via Getty Images

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For the Apple Inc. (NASDAQ: AAPL | AAPL Price Prediction) iPhone 16 launch to succeed, sales must be strong in China.
However, the iPhone faces stiff competition there.
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Apple Inc. (NASDAQ: AAPL) will release the iPhone 16 this month. Its AI-driven iOS 18 will follow a few days later. The expectation is that between them that will cause a huge upgrade cycle as people turn in their older iPhones for what is supposed to be a new and remarkable model. Of course, it is not that simple. For the iPhone launch to be a success, sales must be strong in China. It remains the largest smartphone market in the world by far.

As CNN pointed out, “Apple also needs to convince investors that it hasn’t fallen behind in the AI arms race, as rivals have already released similar features with the new technology.” The challenge has already begun in China. Huge Huawei, among China’s local smartphone companies, recently released a smartphone called the Mate XT. It is a foldable phone, which the iPhone is not. It has its own AI features. Soon enough, the market will show if folding is an attraction. According to CNBC, consumers have pre-ordered 2.7 million units of the new Huawei model.

It is worth remembering that Apple’s stock took a beating earlier this year. One report showed iPhone sales dropped 24% in the first six weeks of 2024, compared to the year before. Strong Huawei sales reportedly were the primary cause.

Apple’s financial results have shown a struggle in China so far this year. For the first nine months of Apple’s fiscal year, Greater China revenue dropped from $57.5 billion in the same period the year before to $52.9 billion.

Chinese consumers own about 950 million smartphones. In the United States, the figure is about a third of that. Without China, the iPhone 16 cannot be a huge hit.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.