Apple topped smartphone sales in China in the fourth quarter of 2022, enabling the US tech giant to rank as the country’s No 2 brand for a full year for the first time, according to the latest data from Counterpoint Research, as the industry’s biggest market continued to struggle from weak demand. China’s smartphone sales declined 15 per cent in the three months ended December 31, marking the fourth consecutive quarter of double-digit decreases in 2022 amid a cooling domestic economy and a surge in Covid-19 cases after the central government relaxed its draconian pandemic controls last month. Macroeconomic headwinds, along with coronavirus-related disruptions since 2020, have weakened consumer demand in China and led to a smartphone sales slump for the fifth year in a row, according to Archie Zhang, a Beijing-based analyst at global tech research firm Counterpoint, in a report published on Friday. “Since the spring of 2022, many cities in China … were being subjected to Covid-19 restrictions, which negatively [affected] consumer sentiment and further delayed smartphone replacements,” Zhang said. The latest industry data from Counterpoint reflects cautious optimism for the near-term prospects of all vendors competing in the world’s largest smartphone market. “The sudden change in China’s Covid-19 policy caught the market off guard, but the reopening process is also ahead of the expected schedule,” Zhang said in the report. “Consumer sentiment will take longer than the economy to recover, particularly when it comes to income prospects,” he said. “Therefore, we do not expect any explosive growth in smartphone sales this year. But a marginal recovery can still be expected.” He indicated that some positive signs of smartphone sales growth may appear in the second quarter, when normal social activities across the country are restored. China’s smartphone industry to remain under pressure in 2023, analysts say Apple seized a 23.7 per cent share in China in the December quarter – a record quarterly high for the US firm – on the back of demand for its iPhone 14 models. Still, Apple recorded a 12 per cent year-on-year decline in that period, a double-digit sales drop that its major domestic Android rivals also experienced, according to the Counterpoint report. Sales of Vivo , which ranked behind Apple in the fourth quarter, fell 21 per cent in the same period. The rest of the top five smartphone vendors – Oppo , Honor and Xiaomi Corp – saw their sales decline 21 per cent, 15 per cent and 19 per cent, respectively, during the quarter. US-blacklisted Huawei Technologies Co , which briefly surpassed Samsung Electronics to lead global smartphone shipments in early 2020, recorded a 15 per cent year-on-year jump in sales in the same period, “recovering from its low base in 2021”, according to Counterpoint’s Zhang. Vivo retained China’s No 1 smartphone vendor ranking for the whole of 2022, with a 19.2 per cent market share. It was followed by Apple’s 18 per cent share, Oppo with 17.5 per cent, Honor with 16.7 per cent and Xiaomi with 13.9 per cent. China’s total smartphone sales in 2022 contracted 14 per cent year on year to “reach their lowest level in a decade”, according to Counterpoint. Apple, however, outperformed the market with just a 3 per cent decrease. Honor, the former budget smartphone business of Huawei, was the only smartphone vendor in China in 2022 to have positive sales growth, with a 38 per cent year-on-year increase. Vivo, Oppo and Xiaomi saw a year-on-year drop of 23 per cent, 27 per cent and 19 per cent, respectively, as demand fell because of economic uncertainty. Apple leads fourth-quarter smartphone rankings as 2022 global shipments fall Chinese Android smartphone makers “continue to believe that the premium segment is the key” for boosting sales, which led them to introduce a number of high-end models this year, the Counterpoint report said. They also launched more foldable devices , as competition in this market segment is expected to intensify this year. Counterpoint expects Chinese smartphone vendors to expand their foldable offerings in overseas markets. In a separate report earlier this week, tech market research firm IDC said worldwide smartphone shipments fell 11.3 per cent to 1.21 billion units in 2022. That represented the lowest annual shipment total since 2013, owing to “significantly dampened consumer demand, inflation and economic uncertainties”. The top five in IDC’s 2022 global smartphone vendor ranking was led by Samsung Electronics , followed by Apple, Xiaomi, Oppo and Vivo.