Apple, the largest corporation in the world with a market value of $2.7 trillion, gets around one-fifth of its revenue from China. With every iPhone user possessing an average of 2.5 Apple devices, the company’s influence in the nation is well-established, but a long-term effect could be troublesome.
New rivalry has emerged when Huawei, the top smartphone manufacturer in China, debuted its newest premium smartphone just days before Apple unveiled its newest iPhone 15 in mid-September.
Given Apple’s positive connection with the government and the low danger of a large revenue loss or outright ban in China as a result of these actions, says senior technology equity analyst at CFRA Angelo Zino. Given recent technological advancements, “a bigger concern for us is potentially Huawei making a comeback at the high end of the market, increasing competitive pressures and potentially forcing Apple to give back some share over time.”
According to CFRA, Apple holds around a two-thirds market share in China’s premium smartphone market. Huawei wants to slice into that market. Following a nearly complete embargo by the US government in 2019, the Chinese company, previously the top mobile phone manufacturer in the world by sales, suffered greatly.
The restrictions reduced Huawei’s presence globally, and its market share in China fell from 27% in 2020 to 11% so far in 2023. Huawei was also denied access to semiconductors to create smartphones and 5G infrastructure. Apple had a significant increase in market share, going from 11% to 19%.
Now, things may go both ways. The Mate 60 series, the most recent top-tier devices from Huawei, support satellite communications and have specs that are on par with those of the most recent iPhones. In the upcoming year, analysts predict it will sell 12 million units.
Some business strategists worry that Apple’s honeymoon period with China, the largest smartphone market in the world, may be coming to an end as the long-running competition between Beijing and Washington for technical supremacy continues.