iPhone sales in China staged a dramatic rebound in March, new data show, as the market begins to recover from the supply and demand shocks caused by the onset of the coronavirus pandemic.
In March, according to new data from China’s Ministry of Industry and Information Technology, total handset sales were up 241% from February to 21.8 million units, though still down 23% from a year earlier. The total included 6.2 million 5G phones, up 161% from February, and accounting for 27% of all phones shipped, down from 37% a month earlier.
Barclays analyst Tim Long says this reflects a 416% surge in iPhone sales in March from February, to about 2.5 million units, shifting the balance back to 4G phones. Apple (ticker: AAPL) is expected to announce its first 5G iPhones later this year.
Android phones were 88% of the China smartphone market in March, down from 92% in February.
Long notes that Apple has started running promotions in China to boost volume in competition against new 5G phones from Huawei and others, with iPhone discounts ranging from 7% to 18% on the e-commerce sites
He also concludes that the Apple supply chain “has largely returned to normal,” and that the anticipated debut of a new iPhone SE is likely soon. But he also cautions that Apple’s 4G phones will face growing competition in China from rivals’ 5G phones, as well as economic pressures in other markets, leading to intensified competition for market share in China. He says the new data suggest iPhone sales in China for the quarter ended in March were down 4.4% year over year, slightly better than he had expected, but that the real test will be the 5G iPhone debut later this year.
Long is keeping his Equal Weight rating and $268 target on Apple shares.
Apple stock was up 0.4% Monday afternoon to $269.04. The
Dow Jones Industrial Average
was down 2.1%.
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