Graphic=Son Min-kyun

Apple's self-developed on-device artificial intelligence (AI) model 'Apple Intelligence' has been incorporated into the iPhone 16 series, but its market share in China has reportedly declined.

According to CNBC on Nov. 11, Taiwanese TF Securities analyst Guo Ming-Chi noted that iPhone shipments in China's smartphone market decreased by 10% to 12% last December. While overall smartphone shipments in the Chinese market remained flat compared to the previous year, iPhone shipments saw a relatively significant decline. Accordingly, Apple is adopting a cautious stance on its iPhone production plans for this year with major suppliers.

Guo Ming-Chi's analysis anticipates that Apple will likely launch the iPhone SE4 around April this year, but first-half shipments are expected to decline by 6% compared to last year. He said, 'I expect Apple’s market share in the Chinese market to continue to decline.'

This is because the SE4 and iPhone 17 series being released this year are likely to only support eSIM, which Apple currently does not sell in the Chinese market. Analyst Guo Ming-Chi diagnosed that 'unless these two models undergo design modifications, Apple may struggle to increase shipments in China.'

Guo Ming-Chi pointed out that there is no evidence that Apple's Apple Intelligence drives consumers to purchase the iPhone 16 series or leads to an increase in Apple's revenue. He claimed that based on his research, Apple Intelligence has not increased demand for iPhone replacements. Guo Ming-Chi added, 'Apple Intelligence has significantly decreased in attractiveness compared to the rapidly advancing cloud-based AI services over the next few months.'

Meanwhile, Apple's iPhone shipments are estimated at about 220 million units last year and around 220 million to 225 million units this year. In this regard, Guo Ming-Chi said, 'These figures fall below the market consensus of 240 million units.'