iPhone Price Cut Boosts Sales In China

Apple introduced a massive price reduction in China for its iPhones after seeing the gloomy sales report in the recent months. The discount comes in the form of the conversion of iPhone prices from the original US currency retailer value to the local China currency. It has been found that many iPhone units were sold out after the recent price cut.

According to Apple Insider, the UBS reported that the sales estimate for iPhones is in between 32.5 to 34.5 million units for the second quarter of 2019. However, this increase is not result of the boost in the sales of the latest iPhones. A large part actually comes from the higher sales of older iPhone models. This situation is unusual as the iPhone X has been selling well for years until the last quarter of 2018.

The nationwide price cut is common during festivity seasons. However, it is clear that this price cut is not affected by a festivity but by the sales drop on Apple's XS and XR models. Mo Jia, a Chinese Canalys analyst, said that he believed the price drop is either caused by the price reduction when Apple ships to the distributors or the distributors slashing the price of the phones by themselves.

One of the reasons why the consumers in China started to lose interest in iPhones is that there are other smartphone models being produced by the local companies with comparable features and are available in cheaper price tags. The Cupertino company now faces pressure from the competition of the Chinese rivals that can further impact its market share in China.

Citing research firm IDC’s data, CNBC reported that the shipments of iPhones dropped by 20 percent in the last quarter of 2018. Aside from the Chinese competitors, the economy slump is another reason why the revenue of Apple dropped in China. While Apple sales dropped, local mobile device manufacturer Huawei has seen an increase in the shipments of its smartphones by 23 percent. Huawei ranked second in the list of the largest smartphone sellers in the world last year.