Apple (AAPL, Financial) is currently battling to maintain its position in China, the world's largest smartphone market, where foreign-branded shipments tumbled a record 47.4 percent in November from a year earlier. It was the fourth straight month of foreign handset shipments shrinking, including to just 3.04 million units, the lowest since September, with shipments of foreign handsets, including Apple's flagship iPhone, decreasing, and the shipments of foreign handsets decreased.
The troubles for Apple are exacerbated by the sluggish Chinese economy and worsening competition from local upstarts like Huawei. However, according to research firm IDC, Apple's iPhone sales fell by 0.3 percent in the third quarter, and Huawei's surged by 42 percent. Just a month before, Apple had even seen its position among China's top five mobile phone brands slip.
Just when it seemed Apple's iPhone 16 lineup could not get any better, it launched aggressive discounts on iPhone 16 models and older models from January 4 to 7, an attempt to regain lost ground. The price cuts are aimed at stimulating demand — the iPhone 16 Pro will be available for as little as 500 yuan less than an iPhone 16 Pro Max, and similar discounts are applicable for other devices. These discounts are for customers using payment platforms such as Alipay and WeChat Pay.
Even with these headwinds, Apple's stock has gained over 32% over the last year thanks to what many view as its membership in the "Magnificent Seven" group of tech giants. However, shares were edged lower in premarket trading on Friday, a sign of investors' caution as the company proceeded in a crowded and uncertain Chinese market.
On this topic, of course, analysts and shareholders will closely watch the effectiveness of Apple's pricing initiatives as it adjusts to the changing landscape.
