Report: iPhone Sales Fell 20 Percent in China in Q4

Sales of Apple’s iPhone lineup dropped an astonishing 20 percent in the most recent quarter, while Huawei sales surged 23 percent in the same time period.

The news is interesting on a number of fronts. But my key takeaway is this: The IDC report proves that Apple blaming only China for its iPhone sales drop-off is a smoke screen: Its sales in China were only slightly worse than they were worldwide.

Apple doesn’t provide unit sales figures anymore, but the firm announced in January that its quarterly revenues from iPhone had plummeted 15 percent, year-over-year. That doesn’t mean that iPhone unit sales fell 15 percent, however: Apple raised prices across the board in 2018 in order to maintain its margins, and the average selling price of the iPhone went up. So I’ve estimated that Apple sold about 63 million iPhones in that quarter, a drop of 18 percent.

Sales of Apple’s iPhones dropped by 20 percent in China. That’s worse than the worldwide number, but not much worse. And that means that Apple over-emphasized China—an easy target here in the U.S. these days—in its warning about iPhone sales, both before and during its earnings announcement.

There’s some other interesting data in the IDC report, however.

As noted, Huawei sales surged by 23 percent in the same quarter, indicating that this phone maker—which is now number two in the world ahead of Apple—has improved the quality of its products dramatically. As important, it does a much better job of serving the unique needs of the China market than does Apple, which does little to localize its offerings.

Curiously, Xiaomi, another China-based smartphone giant, had Apple-like troubles in the quarter: Its unit sales fell almost 35 percent. But there’s an unrelated reason, IDC says: Xiaomi suffered from “inventory corrections and an internal restructuring,” the firm claims. And it expects a resurgence once 5G-based products begin shipping this year.

Overall, Apple is just the fourth-best-selling smartphone maker in China, according to IDC, behind Huawei, Oppo, and Vivo. Xiaomi is in fifth place. (And IDC doesn’t even mention Samsung, which is strange.)

Note: I’ve had to base this article on other reports about the IDC report, which is not yet public.

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Conversation 16 comments

  • obarthelemy

    11 February, 2019 - 12:14 pm

    <p>I'm curious how much of that is due to delayed upgrades, and how much to switching to Android. </p><p><br></p><p>I'm wondering if Huawei has been mopping up ex-Applers… Apple has been saying they sell at the high-end, when in reality they sell mostly at the safe end. Prices + the no-button redesign + the political connotations have weakened that "safe" positioning in China.</p><p><br></p><p>I don't buy Xiaomi's internal stuff + "5G will make it better" line. 5G will work the same for everybody and if anything favor high-end phones where Xiaomi is weak. Honor/Huawei has been focusing on looks and pics and image (fancy backs, mucho cameras…), Xiaomi hasn't. Maybe the Xiaomi – Redmi split will help.</p>

    • Jorge Garcia

      11 February, 2019 - 6:47 pm

      <blockquote><em><a href="#404110">In reply to obarthelemy:</a></em></blockquote><p>In China there is little stigma to having an Android as most things are accomplished on the perfectly cross-platform WeChat app. That is probably why Apple's grip was able to weaken so quickly. In Los Angeles, where I live, it doesn't even matter if someone releases a phone that is 2X better than an iPhone at 1/2 the cost…if it doesn't have iMessage or FaceTime, then it just isn't a "real" phone worthy of your consideration.</p>

      • wright_is

        Premium Member
        12 February, 2019 - 3:14 am

        <blockquote><em><a href="#404182">In reply to JG1170:</a></em></blockquote><p>It is interesting, none of the iPhone users I know in Germany (only about half a dozen) use iMessage, they all use Telegram or WhatsApp.</p>

      • Daekar

        12 February, 2019 - 8:06 am

        <blockquote><em><a href="#404182">In reply to JG1170:</a></em></blockquote><p>Holy smokes, that's a scary level of mindless lock-in.</p>

  • BrianEricFord

    11 February, 2019 - 12:21 pm

    <p>”Don’t believe Apple’s claims about China but take Xiaomi’s at face value.”</p>

  • dcdevito

    11 February, 2019 - 12:34 pm

    <p>One has to think Huawei, due to the US government's position on them, will have the same issue in the US. </p>

    • wright_is

      Premium Member
      12 February, 2019 - 3:12 am

      <blockquote><em><a href="#404127">In reply to dcdevito:</a></em></blockquote><p>Given that the US Government pretty much prevented them from getting established in the first place, I doubt it will make much difference.</p><p>They tried to jump into the US market with the Mate 10 series last year, which would have been their first bit release in the USA, but all the carriers that had agreed to sell the phone dropped them at the last minute, so the effect has already been reflected in Huawei's poor 2018 sales, oh, wait…</p>

  • obarthelemy

    11 February, 2019 - 12:48 pm

    <p>@dcdevito : the difference is, Huawei never sold much in the US, so they won't be getting growth there. Apple is a huge seller in China, and now it's getting shrinkage there. Shrinkage looks worse.</p>

    • skane2600

      11 February, 2019 - 1:13 pm

      <blockquote><em><a href="#404130">In reply to obarthelemy:</a></em></blockquote><p>Certainly the US government is doing all they can to protect Apple from Huawei competition, but I wouldn't count them out in the US just yet. We have a Huawei phone that costs under $300 that has most of the features of flagship models. </p>

  • johnh3

    11 February, 2019 - 7:30 pm

    <p>Read somewhere that Samsung had around 20% marketshare in China for some years ago and now only around 1%. LG are out from China with mobile to.</p><p>So more brands than Apple struggling there.</p>

  • Dryloch

    11 February, 2019 - 9:52 pm

    <p>Samsung is announcing the S10 next Wednesday. If they try to jack up prices like Apple I will not be buying one. Learn from Apples misplaced hubris on pricing. Keep prices at the same level and keep the headphone jack and I am onboard. </p>

  • dontbe evil

    12 February, 2019 - 12:49 am

    <p>finally some apple fans starts to wake up</p>

  • technicalgh

    12 February, 2019 - 10:18 am

    <p>well explained</p>

  • red.radar

    Premium Member
    12 February, 2019 - 7:46 pm

    <p>I have become a believer that Apple is going to have a bad quarter. Apple hardware is going on sale at retailers. Not a positive sign. </p>

  • Marius Muntean

    13 February, 2019 - 3:38 am

    <p>And yet it is rumored that Apple plans to keep the same imbecile pricing this year too, meaning non US regions will get ridiculous prices again, as always. Even if you add the average sales tax to the US Apple prices, it does not even come close to prices in Europe and let's be serious, import taxes are in both US and Europe for example, so this pathetic reason does not stand!</p><p>At least Samsung makes a 1-1 currency rate between USD and EUR (not fair as well, but at least better than what Apple does!)</p>

  • melinau

    Premium Member
    13 February, 2019 - 5:13 am

    <p> Owning a "Premium" foreign product in China is no-longer a badge of status. Trump-inspired (or channeled) xenophobia in USA is echoed China, it is now explicitly a matter of 'honour' to buy Chinese goods, a national 'duty'. US hysteria at IP theft etc, and attempts to sabotage Chinese Producers merely reinforce deeply held anti-Western prejudice in China. </p><p><br></p><p>The ridiculous Trump trade wars are depressing world growth and are hitting most Western exporters as China's economy slows-down. The effects of these factors are heavily reinforced becuase Chinese products are often at least as good as US (made in China!) ones and usually far better value.</p><p><br></p><p>Apple's historical arrogance might prove to be its undoing as the 'phone market continues to commoditise, and its historical demographic fades away. It's no-longer 'cool' to buy Apple: a middle-aged Brand with a middle-aged image. Why pay several hundred pounds or dollars over the odds for a product your Dad (or Grandad) uses? No amount of pretty young things prancing about in their adverts will change that. </p>

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