Apple opens 2% higher on report China iPhone 16 sales up 20% in first 3 weeks YoY

Investing.com -- Sales of Apple (NASDAQ:AAPL )'s latest iPhones in China have reportedly surged 20% in the first three weeks compared to last year’s model, a positive sign for the tech giant in a market where it has faced challenges this year. Apple shares opened the Friday trading session about 2% higher. 

The iPhone 16, which launched in September, has outperformed its predecessor so far, according to data from Counterpoint Research provided to Bloomberg News. Consumers have been gravitating toward the more expensive models, with sales of the high-end Pro and Pro Max versions jumping 44% compared to the equivalent models from 2023.

Though the data represents only a brief snapshot, it indicates a stronger start for Apple’s 2024 release.

Per Bloomberg, Counterpoint analyst Ivan Lam noted that production issues affected the initial rollout of the iPhone 15, which likely limited its early sales. Moreover, Apple has faced competition from Huawei Technologies Co.’s Mate 60 series, which has drawn in local buyers with its domestically produced processor. Lam added that Huawei’s device is still selling well.

“Given the smooth production ramp-up, consistent pricing strategy, and the initial wave of upgrades by existing iPhone users, the iPhone 16 series has experienced substantial growth in the Chinese domestic market,” Lam told Bloomberg. “The product mix has also improved markedly.”

Despite its strong start, the iPhone 16 is up against stiff competition from local players this year.

Vivo recently launched its X200 Pro flagship model, Huawei is expected to unveil its next-generation Mate device in November, and both Xiaomi (OTC:XIACF ) and Oppo have plans to refresh their product lines by the end of the year.

China remains Apple’s largest and, according to CEO Tim Cook, its most competitive smartphone market globally.

At the same time, the iPhone remains Apple’s most critical product, accounting for around half of its overall sales.

Apple’s shares hit a record high this week, buoyed by optimism surrounding the launch of its AI-powered iPhones. Some analysts had expressed concerns about how the iPhone 16 would perform in China, particularly because Apple lacks a local partner to support AI features.

Beijing’s restrictions on foreign-developed AI models could compel Apple to partner with a domestic company like Baidu (NASDAQ:BIDU ) to fully integrate these technologies.

Source: Investing.com