Apple reported record profits in the last quarter of last year, and CEO Tim Cook emphasized the growth in iPhone sales in China as a main reason for this.
That was a dramatic turnaround after 18 months of declining sales in the country, and analysts say there are three reasons for this…
Best iPhone sales ever in China
Cook reported that Apple had seen success in China across the board, including both existing iPhone owners upgrading to later models and people switching from Android.
Greater China grew 38% year-over-year. It was led by iPhone where we set an all-time revenue record, so it was the best iPhone quarter ever in Greater China […] Traffic to our China stores grew by strong double digits year over year. It was a great quarter. Our installed base reached an all-time high in both Greater China and Mainland China. And we set an all-time record for upgraders and saw strong double-digit growth in switchers.
And according to a survey by Worldpanel, iPhones were the top 3 smartphones in urban China during the quarter.
Apple had previously seen an 18-month decline in iPhone sales in Greater China thanks to the growing sophistication of models launched by domestic brands.
Three reasons for success
Analysts quoted by Wires they say there are three reasons for this turn.
First, the base model iPhone 17 offers a lot of phone for the money. It’s why it was this model — not the more exciting iPhone Air or the more sophisticated iPhone 17 Pro — that we crowned Apple product of the year.
The iPhone 17 achieved something that a ‘base’ model hasn’t achieved in years. It’s a great all-around iPhone with zero significant compromises […] It’s the first non-Pro iPhone to offer an always-on display with ProMotion. It also has the same 18MP selfie camera with Center Stage as the iPhone 17 Pro, plus an improved 48MP Ultra Wide lens on the back […] For the first time ever, the base iPhone compares extremely well to the Pro model. All you’re getting is a bit more battery life, a bit more performance and a third camera.
Counterpoint analyst Gerrit Schneemann said this was a big change from the start of last year.
The basic iPhone 17 represented a much bigger step than usual from the iPhone 16, including features traditionally only associated with the Pro series. That may have motivated more people to upgrade faster than usual after the new phones came out, Schneemann says.
Second, Apple managed to hit a price point low enough to qualify for a government subsidy — putting the model at just 7 cents under the ceiling.
To help stimulate the economy, Beijing spent about $43 billion to subsidize domestic purchases of electronics, appliances and cars in 2025. Smartphones sold for less than RMB 6,000 (about $860) were eligible for a discount of up to 15 percent. Apple listed the iPhone 17 in China for RMB 5,999, ensuring that price-sensitive buyers would be able to take advantage of the government’s policy.
Third, the very attractive new model landed at the right time. Many iPhone owners in China upgrade every three to four years, and Apple’s last peak sales period came with the launch of the iPhone 13.
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