Apple iPhone Sales in China Rebound After Two-Year Dip

• Apple Inc. (AAPL) saw an 8% year-on-year increase in iPhone sales in China during Q2 2025, marking its first growth in the region since Q2 2023, driven by well-timed promotions ahead of the 618 shopping festival.
• Huawei’s 12% sales growth and top market share position in China, fueled by loyal users upgrading to new devices, intensified competition, pushing Apple to third place behind Vivo.
• Despite a 15% stock decline this year and U.S. tariff threats, Apple’s strategic pricing and trade-in incentives bolstered its recovery in China, though sustaining momentum faces challenges from Huawei and trade tensions.

Apple Inc. (AAPL) has staged a notable recovery in China, its third-largest market, with iPhone sales rising 8% year-on-year in the second quarter of 2025, marking the first growth in the region since Q2 2023, according to Counterpoint Research. This rebound, driven by strategic promotions in May ahead of China’s 618 shopping festival, saw e-commerce firms offer significant discounts on the iPhone 16 models and increased trade-in prices, boosting consumer demand. The well-timed price adjustments, as noted by Counterpoint’s Associate Director Ethan Qi, capitalized on the festival’s heavy discounting environment, helping Apple reverse a troubling trend after a reported nearly 50% year-on-year drop in shipments of non-Chinese smartphone brands in May.

The resurgence comes amid intensifying competition from Huawei, which has reclaimed significant ground in China’s premium smartphone segment following its recovery from U.S. sanctions. Huawei’s sales surged 12% year-on-year in Q2 2025, securing the top spot in market share, followed by Vivo, with Apple holding third place. Counterpoint Senior Analyst Ivan Lam highlighted Huawei’s success as driven by strong brand loyalty, with users upgrading to new releases like the Mate 70 and Pura series, which feature advanced domestically produced chips. This technological leap has allowed Huawei to chip away at Apple’s market share, a challenge compounded by China’s restrictions on iPhone use in some government agencies and broader U.S.-China trade tensions.

Apple’s performance in China is critical for its global strategy, as the region remains a key revenue driver despite a 15% decline in the company’s stock price this year. Investors, wary of headwinds including U.S. President Donald Trump’s threats of tariffs and calls for domestic iPhone manufacturing, will likely view this growth as a positive signal. Trump’s pressure on Apple CEO Tim Cook to shift production to the U.S. is seen as logistically challenging, given China’s entrenched role in Apple’s supply chain. Meanwhile, Huawei’s aggressive product launches and reentry into international markets add further pressure, as its advanced chips defy expectations set by earlier U.S. export controls.

The broader Chinese smartphone market is navigating a complex landscape, with Q2 2025 growth tempered by economic uncertainties and trade tensions. Apple’s ability to leverage promotions and adapt to local market dynamics demonstrates resilience, but sustaining this momentum will require navigating Huawei’s competitive surge and potential tariff-related disruptions. As China’s smartphone market continues to evolve, with low-single-digit growth projected for 2025, Apple’s strategic pricing and product innovation will be pivotal in maintaining its position against domestic rivals and geopolitical challenges.

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