Apple’s (AAPL) iPhone shipments in China are growing, up 40% year-over-year in May, according to reports. The growth comes as the tech giant ramps up price discounts in an effort to boost its market share in China.
Yahoo Finance’s Seana Smith and Brad Smith break it down further and provide insight into other international markets where Apple is looking to grow.
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Video Transcript
According to a Chinese government-affiliated research firm, Apple’s iPhone shipments in China increased 40% in May compared to the same month last year.
The move came as tech giants doubled down on discounts, slightly slowing the pace of growth in April.
Here we can see that the stock is currently up about 2/10ths of a percent.
For Apple, of course.
It’s really going to depend on how many people switch over to this next wave and the next cycle, probably not just the one that’s coming out in September this year, but the iPhone 15, which has an operating system that can basically power some of the new generative AI capabilities that were being touted at WW DC.
And there, shipments may start to pick up. As well as China, another key region that will be important for Apple in this regard could be India. So, the US, India and China remain the most important players for Apple internationally right now.
Yes, certainly.
If we look at the increase in demand, we’re seeing a 40% increase in May.
That’s important.
Because we’re talking about the fact that Apple is losing market share to some domestic companies in China.
It will probably be difficult to appeal to a stronger base of support.
At a time like this, consumers are increasingly turning to the internet, especially amid rising geopolitical tensions between China and the US government in recent months.
And again, obviously, when you look at this increase, and the massive 40% increase that this initial data shows, it’s also important to point out that this is coming at a time when smartphone shipments overall are up just 13%.
However, the growth rate of international brands is nearly four times that of domestic brands, far outpacing the growth rate of domestic brands.
But again, China is an important country and obviously an important region for Apple, and we’ve spoken many times about its importance to our future growth here.
So gaining greater support domestically should clearly be considered a win for Apple.
So it took until May for Apple to join the rally we saw in its stock price throughout 2024, and Apple was effectively left out for five months, almost five months.
It was in recent weeks, May and June, that the company decided to join in on this movement, allowing it to essentially rise by around 24% in this period since the beginning of May.
And so, all things considered, being able to announce that they’re really participating in this broader thematic and thematic play for a lot of people, and being able to show that they can weather a consumer environment that’s pushing back against rising prices for consumer technology, this is a reality.
Even if there is no need to replenish, this is demand creation and will trigger the next replenishment rate cycle.
