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Apple faces a decline in iPhone sales, with a familiar culprit in the spotlight

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Update on : March 23, 2025

Apple has long been one of the most successful and influential companies in the world, but 2024 has been a bit of a rocky year for the tech giant. The first half of 2025 doesn’t look much brighter, as the company faces challenges in maintaining its dominant position in the smartphone market.

Decline in Sales and Market Share

Recent data from Counterpoint Research reveals that Apple’s iPhone market share has taken a hit globally, losing about one percentage point in 2024. While its major competitor, Samsung, is also facing difficulties, Chinese manufacturers like Motorola, which is now part of Lenovo, Huawei, and Honor have been gaining ground. In fact, Apple’s sales have fallen by about 2%, even though the overall smartphone market is growing by 4%.

So, what’s behind this drop? One factor, according to experts quoted by Bloomberg, is the absence of Apple Intelligence in China, which has contributed to a lukewarm reception for Apple’s latest products. Tarun Pathak, director at Counterpoint, points out that the iPhone 16 lineup was met with a mixed response, partly due to the lack of Apple Intelligence at launch. However, Apple has continued to see strong growth in non-strategic markets, such as Latin America, showing that the company isn’t entirely struggling across the board.

A Challenging Outlook for 2025?

Looking ahead, some analysts are less optimistic about Apple’s future prospects. Ming-Chi Kuo, an analyst at TF Securities, suggests that there’s little evidence to suggest that Apple Intelligence will lead to any significant hardware upgrades or increased service revenue. In fact, he argues that this new feature has not sparked any major demand for iPhone upgrades. According to Kuo, the interest in Apple Intelligence has waned compared to the rapidly evolving cloud-based AI services that have become more popular in recent months.

For 2025, Kuo predicts a sluggish year for Apple. In particular, he points out that the company has taken a cautious approach in its iPhone production plans for the coming year. Despite the highly anticipated release of the iPhone SE 4, Kuo forecasts a 6% drop in iPhone shipments for the first quarter compared to the previous year. A significant reason for this decline could be the phone’s lack of support for eSIM, a feature that is gaining traction, especially in the Chinese market.

However, it’s not all bad news for Apple. Kuo still expects the company to sell between 220 and 225 million iPhones in 2025. While this is below the general market consensus, it remains a strong number for the tech giant.

As the tech landscape evolves, Apple will need to rethink its strategy to stay ahead of the competition. The upcoming year will likely reveal whether Apple can regain its momentum or if competitors will continue to nibble away at its market share.