Apple tipped to enjoy Q3 sales bonanza, but not enough to close gap on domestic rivals

Canalys projections suggest iPhone maker shipped 11 million smartphones in the current quarter, an impressive 40pc rise on the third quarter 2016

PUBLISHED : Monday, 30 October, 2017, 7:03pm
UPDATED : Monday, 30 October, 2017, 11:14pm

Apple’s smartphone shipments to China are tipped to rebound in the third quarter, according to research firm Canalys, but the result is still unlikely to make a lot of change to its overall market share of the world’s largest market.

The projections suggest the iPhone maker shipped 11 million smartphones in the current quarter, an impressive 40 per cent rise from 8 million in the third quarter in 2016 – its highest rate of growth since 2015.

This shipment growth in China – the most important market for Apple outside its home market – is expected to give a much needed shot in the arm for the US tech giant, due to report quarterly results on Thursday.

After opening advanced sales online last week, Apple is about to actually start shipping iPhone Xs, its most anticipated device for years, on Friday.

Its market share in China has slowed consistently since 2015, and now ranks behind home-grown phone brands Huawei, Vivo, Oppo and Xiaomi in terms of numbers.

“Demand from iPhone users have helped fuel orders for iPhone 8s and the larger iPhone Plus in China in the absence of the iPhone X,” said Canalys research analyst Mo Jia.

“Price cuts on earlier models in the run up to the release of the iPhone 8 have also certainly helped, but the growth in sales is unlikely to be sustained into the December quarter.”

The US phone giant has launched three devices this year and the iPhone X is expected to prove a big hit with Apple fans in China. But analysts still do not think they will be enough to halt overall shrinking shares in the world’s second largest economy.

“The growth in the September quarter is only temporary. We don’t expect Apple to continue such growth in China in coming months as the highly anticipated iPhone X still may not prove itself as much of a strong money spinner in the mainland in the near term,” said Jia.

Part of that is price he added. The iPhone X is Apple’s most expensive phone to date, designed to showcase its very latest technology such as wireless charging, organic light-emitting diode (OLED) display, dual cameras with improved depth sensing, along with a face recognition unlock system.

As a result, it starts at 8,388 yuan (US$1,262) in the mainland, US$200 more than the device’s launch prices in the United States and Japan.

“The high price of iPhone X in China means it is not the device for everyone, and Apple still needs to overcome its production capacity challenges, which is expected to weigh on sales in the near future,” said Jia, adding shipment dates to the mainland are already standing at five-to-six weeks from order date.