Apple's Strong iPhone Demand in China Amidst Growing Competition

Apple sought to reassure investors about its position in the Chinese smartphone market, emphasizing robust demand for iPhones in the region. CEO Tim Cook stated, "In mainland China, we set a quarterly record for the September quarter for iPhone. We had four out of the top five best-selling smartphones in urban China."

Apple appears to have made gains in market share in China during the July-September period, despite an overall contraction in the smartphone market. Cook expressed confidence in the company's performance, indicating that they expect to sell more iPhones in the upcoming holiday quarter, even with one fewer sales week compared to the prior year.

Although research firm Canalys reported a 3% decline in overall smartphone sales in China from a year earlier in the same period, Apple's sales in China only dropped 2.5%. Cook attributed this dip to challenges in Mac computer and iPad sales, which offset growth in other areas.

In contrast, analysts suggest that Huawei experienced strong smartphone sales growth in the same quarter, driven by the success of their Mate 60 Pro phone, which utilizes an advanced China-made chip despite previous challenges due to U.S. sanctions.

Apple's comments follow optimistic insights from chip suppliers Qualcomm and Qorvo, indicating a potential turnaround in the smartphone market, particularly in China. Qualcomm anticipates a 35% quarter-on-quarter increase in sales to Chinese smartphone customers.

While Qualcomm faces competition from Huawei's chips, they do not foresee Huawei's re-entry into the market affecting their relationship with Chinese smartphone companies, signaling a more positive outlook for the industry.