In recent days we have learned the quarterly balance of the smartphone market, with sales clearly recovering and already growing in double digits. Apple has had a very good performance, although it has not been able to shake off some of the dark clouds that have been hanging over it for months. This is the case of its role in the largest market in the world, China, where She is increasingly cornered due to the push of local manufacturers.
And as they say, we should see the forest for the trees. And it is true that Apple’s results in this third fiscal quarter have been very good, with a net profit that has grown by 7.9% compared to last yearsomething that would have been even better had China’s results not been signed.
One good and one bad for Apple
Apple CEO Tim Cook’s earnings call to shareholders was marked by the company’s strong results in almost all regions, with a Sales growth of 4.9%, reaching 85.5 billion dollars. Services are the ones that have driven these good results, thanks to 24.2 billion dollars in sales. Cook himself has expressed his satisfaction with the good sales achieved in this quarter, even reaching exceed expectations of the company.
In fact have grown up in twelve different countriesincluding some as important as Germany, Canada, Philippines, Mexico, France or the United Kingdom. Even the global numbers of the Asia Pacific region have revealed that the manufacturer has increased its sales by 13.5%. But The big setbackand the most unexpected thing that Cook has had to tell shareholders has been that Things in China are not going well. Since sales there have fallen by 6.5%, billing a total of 14.7 billion dollars.
According to Cook himself, these problems in China would not be directly due to the performance of its mobile phones, since the iPhone 15 would be selling better than its predecessor, at least in the last quarter, although in general terms this is not the case, but rather Those from Cupertino blame these problems on the local currencyBut the problem is not so much how the iPhones are performing, but how Apple’s competition is performing, which is becoming increasingly stronger and is displacing its phones from the top sales positions in the Asian country.
Apple out of the Top 5
As revealed by ICIS, Independent Commodity Intelligence Services, Apple has left the Top 5 manufacturers that sell the most in that Asian marketbeing surpassed by other Chinese brands, which are being much more aggressive in their strategies. We have already mentioned that Apple has been forced to make price cuts to its iPhone in China, something very unusual for the brand in the West, not to say unprecedented. And despite this, the competition is being more aggressive in terms of price.
So, Apple currently ranks sixth in Top Salestied with Xiaomi in market share, with 14%, in a market led by Vivo with 19%. And all this would have an explanation, the Chinese consumer is no longer willing to spend so much money on a new mobile phone, and the existing offer does not offer enough appeal to invest a large sum in a new phone. Therefore, it is manufacturers such as Vivo or Oppo that are taking the cake, selling a large volume of mobile phones in the lowest and cheapest ranges, to the detriment of a premium segment that is precisely the one that is driving sales in the rest of the world.
Therefore the The premiumization strategy that is succeeding in the West is failing in China. And it is not something we should ignore, as we could be seeing the preview of what happens in the future in the Western markets, good sales, year-on-year market growth, but with a greater weight of the entry range, boosting its sales volumes and therefore benefiting Apple’s rivals. For this reason, Apple is currently being displaced from that Top 5 in China, something that They will try to reverse it with the iPhone 16 in just a few weeks. Although the information leaked so far does not predict major changes in its hardware, it does in its software, thanks to Apple Intelligence.