iPhone 16 starts stronger than the iPhone 15 in this key market

Many see the iPhone 16 as yet another minuscule upgrade, but (so far) the newest Apple phone is performing better than its predecessor, the iPhone 15.

There's a Bloomberg report that cites Counterpoint Research data and notes that the iPhone 16 series (debuted in September 2024) has "outperformed" its predecessor. Overall, the data shows that consumers still prefer to get the pricier models, so much so that the iPhone 16 Pro and the iPhone 16 Pro Max gained 44% compared with 2023.

Although the data covers just the initial three weeks, it indicates that Apple's 2024 launch is performing better than the previous year's. In 2023, production challenges affected the early sales of the iPhone 15 lineup, likely limiting its initial success, according to Counterpoint analyst Ivan Lam.

At the same time, Apple's flagship product faced tough competition from Huawei Technologies' Mate 60 series, which attracted local buyers with its Chinese-made processor. That device continues to perform well in the market, as noted by Lam.

Lam highlighted that, with a smoother production process, consistent pricing, and a strong response from existing iPhone users upgrading to the new models, the iPhone 16 series has seen significant growth in China. He also pointed out a noticeable improvement in the product mix.

Despite earlier concerns from analysts that the iPhone 16 might struggle in China due to the lack of a local partner for its AI features, the series has been performing well. With Beijing's restrictions on foreign-developed AI models, Apple may eventually need to partner with a Chinese company like Baidu Inc. to continue its growth in the region.

As you probably know, iPhone 16 buyers in the EU are also unlikely to see all the Apple Intelligence features anytime soon because of strict regulations on the Old Continent. Chinese users might have the best chance of experiencing Apple’s generative AI after the iOS 18 update, but there's a big "if".

In the US, Apple has partnered with OpenAI for its ChatGPT-based generative AI service.

However, in China, only local generative AI companies have been granted approval for their models, and ChatGPT is not available commercially. Rumors suggest that Apple may collaborate with local tech giant Baidu for its Ernie LLM, similar to Samsung’s approach in the region. This potential partnership could delay the introduction of Apple’s own AI features in China.

Meanwhile, Apple is under increasing pressure from local competitors like Huawei, which saw a staggering 44% recent growth in shipments within China, compared to Apple’s 6% decline reported earlier. Ivan Lam from Counterpoint Research noted that Apple’s iPhone is likely to continue losing ground in the premium segment to Huawei and other Chinese brands.

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