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Apple is losing market share in China due to declining iPhone shipments, supply chain analyst Ming-Chi Kuo wrote in a report Friday. The stock slipped 2.4%.
“Apple has taken a cautious stance when discussing 2025 iPhone production plans with its major suppliers,” Kuo, an analyst at TF Securities, wrote in the newspaper. job. He added that despite the expected launch of the new iPhone SE 4, shipments are expected to decline by 6% year-on-year for the first half of 2025.
Kuo expects Apple’s market share to continue to decline, as two of the upcoming iPhones are so thin that they will likely only support eSIM, something the Chinese market does not currently promote.
“Both of these models could face problems with transport dynamics unless their design is changed,” he wrote.
Kuo wrote that in December, China’s overall smartphone shipments were flat compared to the previous year, but iPhone shipments fell 10 to 12 percent.
There is also “no evidence” that Apple Intelligence, the company’s in-device artificial intelligence offering, generates hardware upgrades or services revenue, according to Kuo. He wrote that this feature “did not drive iPhone replacement demand,” according to a supply chain survey he conducted, and added that in his view, the appeal of this functionality “has declined significantly compared to cloud-based AI services, which grew rapidly in the following months.”
Apple’s estimated iPhone shipments total about 220 million units for 2024 and between 220 million and 225 million for this year, Kuo wrote. That’s “below the market consensus of 240 million or more,” he wrote.
Apple did not immediately respond to CNBC’s request for comment.
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