Apple experienced a decline in iPhone sales and lost market share to its Chinese competitors last year, highlighting the company’s struggles with Artificial Intelligence (AI) in its second-largest market after the United States.
According to data from Counterpoint Research, Apple’s iPhone market share dropped to 18 percent in 2024, down by one percentage point. Samsung Electronics also saw a reduction in its share, with emerging Chinese brands like Xiaomi and Vivo gaining traction. Over the full year, Apple reported a two percent decrease in sales, contrasting with a four percent growth in the overall smartphone market worldwide.
Based in Cupertino, California, Apple has been lagging in the AI sector. Its new suite of AI enhancements began rolling out after the introduction of the iPhone 16 in September, but these features are currently unavailable in China. The company is still in the process of establishing local partnerships necessary for implementing AI-driven functionalities such as writing assistance and image generation.
“The reception of Apple’s iPhone 16 series was mixed, partly due to the absence of AI features at its launch,” noted Tarun Pathak, a director at Counterpoint. “Nonetheless, Apple has seen robust growth in non-core markets, such as Latin America.”
Among the top 10 smartphone brands, Motorola, a subsidiary of Lenovo Group, along with Shenzhen-based Huawei Technologies and Honor Device, emerged as the fastest-growing. These Chinese manufacturers are actively developing proprietary AI tools and services capable of executing tasks for users.
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