Key Takeaways
- iPhone sales in China increased 23% during the initial nine weeks of 2026
- The overall Chinese smartphone sector contracted by 4% during this timeframe
- Apple maintains pricing strategy, choosing to accept margin compression rather than increase prices
- Rising memory chip expenses are compelling Android competitors such as OPPO and vivo to increase their pricing
- Apple’s robust supply chain management provides a significant advantage over competitors
Apple’s performance in China’s smartphone market is defying industry trends, with iPhone sales climbing dramatically while competitors face headwinds. According to fresh data from Counterpoint Research, iPhone shipments in China surged 23% during the initial nine-week period of 2026. This stands in stark contrast to the Chinese smartphone industry overall, which experienced a 4% year-over-year decline during the identical timeframe.
Despite government-backed subsidy programs introduced at the beginning of the year, overall consumer spending remained weak across the sector. Apple, however, bucked this trend with impressive growth.
The company’s success stems from strategic e-commerce promotional campaigns and the base iPhone 17 model’s qualification for government subsidies. These factors combined to attract more Chinese buyers to Apple’s product lineup during a period when rival manufacturers faced significant challenges.
The current market turbulence traces back to memory chip supply dynamics. AI-related hardware requirements have created unprecedented demand for memory components, driving up manufacturing costs industry-wide and pressuring profit margins for smartphone producers.
Leading Chinese Android manufacturers OPPO and vivo have implemented price increases on select current models this month. According to Counterpoint, these adjustments serve partially as market testing ahead of upcoming product releases.
Apple Maintains Pricing Strategy as Competitors Adjust
Apple is pursuing an alternative strategy. The company’s sophisticated supply chain operations provide greater flexibility to absorb elevated memory costs without transferring them to consumers.
“Apple is unlikely to follow suit, instead absorbing part of the margin pressure and using the situation to potentially expand its market share,” Counterpoint said in its report.
This tactical decision is delivering results. A 23% sales increase amid broader market contraction demonstrates strategic execution—maintaining stable pricing while competitors raise theirs.
Huawei, conversely, is leveraging its own competitive advantage. The company relies on domestic semiconductor suppliers, typically offering more favorable pricing than international memory vendors. Counterpoint suggests this cost advantage could enable Huawei to capture additional market share in budget and mid-tier segments.
Industry analysts anticipate the memory supply constraints will continue throughout 2026. Counterpoint forecasts sustained pressure on the Chinese market from March to May, with potential temporary improvement during the mid-year “618” e-commerce event in June.
Apple’s Greater China Revenue Faces Long-Term Challenges
This sales momentum arrives at an opportune moment for Apple. The company’s Greater China revenue has experienced persistent decline—dropping from $74.2 billion in fiscal 2022 to $64.4 billion in fiscal 2025.
A 2023 directive restricting iPhone usage among Chinese government employees created headwinds. Intensifying competition from Huawei and other Chinese manufacturers further impacted performance.
While the 23% sales growth in early 2026 doesn’t erase the longer-term downward trajectory, it demonstrates Apple’s capability to capture demand when market conditions align favorably.
Memory cost pressures are impacting Apple’s broader product portfolio as well. Micron Technology posted second-quarter revenue growth of 196%, reflecting the extraordinary surge in memory demand.
Apple introduced the MacBook Neo earlier this month at a $599 price point, establishing an accessible entry level for the new laptop series—once again while competitors implement price increases.
The most recent Counterpoint data encompasses the first nine weeks of 2026 and was released Thursday, March 19.
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