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Apple’s start to 2024 was not very good. Among several other factors, one of the reasons that affected the company’s market capitalization was the 30% drop in iPhone sales in China. While the Cupertino-based tech giant quickly received “good news” – overtaking Samsung to become the world’s number one smartphone maker in 2023 – one analyst has painted a bleak picture for iPhone shipments in 2024.
According to analyst Ming Chi-Kuo, iPhone shipments in 2024 are likely to “decline significantly by approximately 15% year-over-year (YoY) due to structural challenges.”
“Apple has reduced its shipments of key semiconductor components for the 2024 iPhone to about 200 million units (a 15% year-over-year decline). “Apple may have the most significant decline among major global mobile phone brands in 2024,” he said, citing its latest supply chain survey.
It noted that the iPhone 15 series “will decline 10% to 15% year-on-year in 1H24” and the new iPhone 16 series (expected to launch in September this year) may see a similar decline in 2H24. These figures compare to iPhone 14 series shipments in 1H23 and iPhone 15 series shipments in 2H23, respectively.
Why iPhone shipments may decline in 2024
Kuo claims that the iPhone faces structural challenges, which will lead to a significant decline in shipments in 2024. These challenges include “the emergence of a new paradigm in high-end mobile phone design and the continued decline in shipments in the market.” Chinese”.
In particular, Apple sales were reported to have declined in the first week of 2024 with the emergence of local brands such as Huawei and Xiaomi. According to Kuo, it is for this reason that Apple’s trend of declining weekly shipments is expected to continue.
This sentiment was echoed by Barclays, which published a research note suggesting “weakness in iPhone volumes and mix.”
“The new design paradigm of high-end mobile phones includes AI (GenAI) and foldable phones. The main reason for the decline in the Chinese market is the return of Huawei and the growing preference for foldable phones among high-end users as their first choice for replacing phones,” he said in his research note.
Samsung will benefit from AI features
Kuo noted that Samsung, which Apple beat to become the market leader in terms of smartphone shipments, will benefit from higher-than-expected demand due to the integration of GenAI features. He highlighted that Samsung has revised downward shipments of the Galaxy S24 series in 2024 by between 5 and 10% “while Apple has revised downward the iPhone 15 shipment forecast in 1H24.”
He further noted that Apple is not expected to release new iPhone models with significant design changes, and that the GenAI ecosystem/apps will not arrive until 2025 at the earliest. Apple’s iPhone shipment momentum and ecosystem growth are likely to continue until then.
According to analyst Ming Chi-Kuo, iPhone shipments in 2024 are likely to “decline significantly by approximately 15% year-over-year (YoY) due to structural challenges.”
“Apple has reduced its shipments of key semiconductor components for the 2024 iPhone to about 200 million units (a 15% year-over-year decline). “Apple may have the most significant decline among major global mobile phone brands in 2024,” he said, citing its latest supply chain survey.
It noted that the iPhone 15 series “will decline 10% to 15% year-on-year in 1H24” and the new iPhone 16 series (expected to launch in September this year) may see a similar decline in 2H24. These figures compare to iPhone 14 series shipments in 1H23 and iPhone 15 series shipments in 2H23, respectively.
Why iPhone shipments may decline in 2024
Kuo claims that the iPhone faces structural challenges, which will lead to a significant decline in shipments in 2024. These challenges include “the emergence of a new paradigm in high-end mobile phone design and the continued decline in shipments in the market.” Chinese”.
In particular, Apple sales were reported to have declined in the first week of 2024 with the emergence of local brands such as Huawei and Xiaomi. According to Kuo, it is for this reason that Apple’s trend of declining weekly shipments is expected to continue.
This sentiment was echoed by Barclays, which published a research note suggesting “weakness in iPhone volumes and mix.”
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“The new design paradigm of high-end mobile phones includes AI (GenAI) and foldable phones. The main reason for the decline in the Chinese market is the return of Huawei and the growing preference for foldable phones among high-end users as their first choice for replacing phones,” he said in his research note.
Samsung will benefit from AI features
Kuo noted that Samsung, which Apple beat to become the market leader in terms of smartphone shipments, will benefit from higher-than-expected demand due to the integration of GenAI features. He highlighted that Samsung has revised downward shipments of the Galaxy S24 series in 2024 by between 5 and 10% “while Apple has revised downward the iPhone 15 shipment forecast in 1H24.”
He further noted that Apple is not expected to release new iPhone models with significant design changes, and that the GenAI ecosystem/apps will not arrive until 2025 at the earliest. Apple’s iPhone shipment momentum and ecosystem growth are likely to continue until then.