Apple CEO Tim Cook holds a new iPhone 15 Pro during the Wonderlust project launch event at the company’s headquarters in Cupertino, California, Sept. 12, 2023.
Loren Elliott | Reuters
Shipments of iPhones are likely to take a hit this year due largely to the growing popularity of foldable phones and Huawei’s resurgence in the Chinese market, says top Apple analyst Ming-Chi Kuo of TF International Securities.
Apple, which became the top smartphone vendor in China last year for the first time, trimmed shipments of “key upstream semiconductor components” to around 200 million units, translating to a 15% year-over-year drop in iPhone shipments, according to Kuo’s blog post on Tuesday about his latest supply chain survey.
Kuo wrote that Apple’s weekly shipments in China have dropped by 30% to 40% from a year earlier in recent weeks, “and this downward trend is expected to continue.”
“Apple may have the most significant decline among the major global mobile phone brands in 2024,” Kuo wrote.
Huawei’s comeback as a leading smartphone maker coupled with the “increasing preference for foldable phones among high-end users as their first choice” in the Chinese market are key reasons for the iPhone’s potential decline, Kuo wrote. New phone designs integrating generative artificial intelligence are also altering the market.
Apple didn’t immediately respond to a request for comment.
Samsung has upped shipments of its new Galaxy S24 series this year by 5% to 10% as it sees “higher-than-expected” demand thanks to its AI-powered features, Kuo wrote. Apple, meanwhile, has lowered its shipment forecast for the iPhone 15 in the first half of 2024, he added.
With no major changes to the iPhone’s designs expected until 2025 “at the earliest,” Kuo wrote, Apple’s “shipment momentum and ecosystem growth” are poised to diminish in the meantime.
Apple is scheduled to report quarterly results on Thursday. Analysts are expecting to see revenue growth of just 0.6% from a year earlier to $117.91 billion, according to LSEG, formerly Refinitiv. And average projections show Apple recording single-digit growth for the rest of the calendar year.
Apple shares fell 1.7% on Tuesday to $188.45.
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This story originally appeared on CNBC
