China's Phone Makers Smell Opportunity As Apple Stumbles On AI
Chinese smartphone makers are actively pushing apps that let users switch from the iPhone as they race to gain market share, while Apple Inc. (NASDAQ:AAPL) struggles to roll out artificial intelligence features in the world's largest smartphone market.
China's top five domestic phone brands now promote tools that simplify moving data from Apple's iOS or allow their devices to work alongside Apple products.
These campaigns gained momentum as China's internet regulator delayed approval of Apple's planned AI feature rollout due to geopolitical tensions with the U.S.
Also Read: China Crowds Rush Apple Stores Again After iPhone 17 Launch
According to Lucas Zhong of Omdia, Chinese vendors are moving faster and more openly on AI, and their strategies are increasing competitive pressure on Apple in China, even if conversions take time, the Financial Times reported on Sunday.
Fragmented Market Keeps Competition Intense
China's smartphone market remains highly competitive, with no brand holding more than 20% share.
Vivo led the market with an 18.5% share in the third quarter, while Apple, Honor, Oppo, Xiaomi (OTC:XIACY), and Huawei each held between 13.6% and 16.4%, according to Counterpoint Research.
Domestic brands now believe AI-powered features and hardware innovations like foldables make their phones compelling alternatives to Apple.
Oppo's AI assistants can track spending from screenshots and provide real-time gym guidance through the camera. Honor's devices help users find discounts, book rides faster, and create short videos.
Switching Tools Designed To Ease Apple Exit
Honor recently upgraded its Device Clone app to let users transfer photos, messages, and contacts from iPhones via QR code.
Its Honor Connect app enables file sharing with iOS devices similar to AirDrop.
Honor executive Xiangdong Li said 37% of online buyers of Honor's Magic V5 flagship switched from Apple using these tools.
Xiaomi has promoted features such as file transfer, screen sharing, and notification syncing with iPhones.
Oppo's latest operating system lets users handle calls, texts, and notifications from Apple devices directly on Oppo phones.
Meanwhile, Apple strengthened its position in China's luxury smartphone market in October by lifting iPhone shipments and expanding its share of total sales.
The Chinese smartphone market grew 8% year over year, with Apple leading the momentum alongside domestic brands.
iPhone 17 Demand Drives Shipment Surge
Apple captured roughly one in every four smartphone sales, while iPhone shipments jumped 37% on strong demand for the iPhone 17 lineup.
All three iPhone 17 models delivered mid-to-high double-digit growth, led by the base version, and new models made up more than 80% of Apple's unit sales, according to Counterpoint analyst Ivan Lam.
Rising average selling prices are also positioning Apple for a potential record December quarter.
Xiaomi, Oppo Gain Ground As Huawei Lags
Xiaomi climbed to the No. 2 spot for the first time in more than a decade, supported by the early launch of the Xiaomi 17 series and a broad product lineup.
OPPO drove domestic brand growth through strong demand for its Find X9 and Reno 14 models.
Despite Huawei's Mate 80 launch in late November, Apple continues to show strong momentum.
Apple's share of one in every four smartphone sales matches its previous peak reached in 2022, even as Chinese brands steadily expand their market presence.
AAPL Price Action: Apple shares were down 0.18% at $278.27 during premarket trading on Monday. The stock is approaching its 52-week high of $288.62, according to Benzinga Pro data.
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