Price cuts help iPhone shipments continue to rise in the world's largest smartphone market

In the world's largest smartphone market, iPhone shipments continue to rebound last month. During the first week of 2024, sales of the handsets fell through a wet paper bag dropping 30%  year-over-year. By March, things had stabilized as iPhone shipments rose 12% year-over-year for the month. In April, shipments of Apple's smartphones in China took off with iPhone shipments rising 52% on an annual basis. The latest report shows that May shipments were up 40% annually.

The rebound came amid Huawei's strong showing following the release of the Mate 60 series last summer. Despite U.S. restrictions that were designed to prevent the manufacturer from obtaining processors that support 5G, Huawei equipped the series with its Kirin 9000s 5G application processor (AP). The chip was built by SMIC, China's largest foundry, using an older 7nm process node. The Mate 60 line was the first from Huawei to support 5G since 2020's Mate 40 series. 

Huawei will soon have a billion active devices running its HarmonyOS operating system which is a sign of the challenge that Apple faces in China going up against the heavily sanctioned firm in the premium segment of the market. The launch of the Mate 60 series released a wave of nationalistic pride which helped drive sales of the new phones. Also impacting iPhone sales in China was a ban announced last year preventing government workers in the country from using Apple's smartphone while in the office or using it for work while out of the office.

For the fiscal second quarter that wrapped up at the end of March, weak iPhone shipments in China during the three months led Apple to report a 10% annual decline in deliveries for the device worldwide. Overall sales of Apple products declined 8.1% year-over-year in Greater China during the quarter. But things have been looking up for the iPhone in China since March.

The iPhone was able to fight back partially due to retailer price cuts made before the country's June shopping festival. A discount of  2,300 yuan ($318) was offered on the 1TB iPhone 15 Pro Max while the 128GB iPhone 15 had its price cut by 1,400 yuan ($194). Bloomberg News own calculations showed that smartphone shipments in China rose by more than 13% in May and that deliveries of foreign-made handsets, a group mostly made up of the iPhone, rose by 52% on an annual basis.

Just over five million units from foreign smartphone brands were shipped into China in May according to the China Academy of Information and Communications Technology.