iPhone sales in China top US

Updated: 2015-01-09 10:59

By JACK FREIFELDER in New York(China Daily USA)

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Increasing demand in China for Apple Inc's latest flagship devices, the iPhone 6 and iPhone 6 plus, has spurred consumers there to buy more iPhones than their American counterparts for the first time, data from UBS showed.

"Recent data suggest that iPhone demand saw outsized growth in China, even finding that China could constitute as much as 35 percent of shipments in the quarter compared with 22 percent a year ago," Steven Milunovich, an analyst with global financial services firm UBS, wrote in a Jan 7 research note.

The US share of iPhone sales is expected to dip from 29 percent a year ago to 24 percent in the first quarter of 2015, he wrote.

Milunovich, who covers Apple for UBS, said the iPhone has seen significant gains in the world's second-largest economy since the device was rolled out in October.

Estimates from UBS show that Apple sold 69.3 million iPhones in the fourth quarter of 2014, a new quarterly record for the Cupertino, California-based multinational. The figure beat the consensus estimate of 65.5 million devices.

Apple's distribution agreement with China Mobile, the world's largest mobile phone operator, could be one of the reasons for the uptick, Milunovich said.

"China Mobile's distribution agreement with Apple was signed in late Dec 2013 and Apple began shipping the iPhone 6/6+ in October, so it seems reasonable that demand in China surged relative to other regions," he wrote.

In October, Apple's new iPhone 6 and iPhone 6 Plus arrived in China despite a regulatory delay in the rollout. Heavy interest from Chinese consumers helped Apple sell nearly 10 million units within three days of the initial sell date on JD.com.

At the end of the third quarter of last year, the iPhone held 18.1 percent of market share in China. In the US, nearly half of all smartphones sold (47.3 percent) were iPhones, according to international market research firm Kantar Worldpanel.

Apple also posted its largest third-quarter sales volume figure in 2014, according to data from the International Data Corp (IDC). The company boosted its global smartphone shipments to more than 39 million units, second worldwide behind Samsung Electronics Co (78 million units).

Samsung, based in Suwon, South Korea, remained the world's largest smartphone vendor in the third quarter of 2014, with 23.7 percent of the market, followed by Apple with 11.7 percent.

Other global players, including domestic Chinese leaders Xiaomi and Lenovo Group Ltd have also managed to squeeze into the fray. Xiaomi and Lenovo rank third and fourth on that list, with 5.2 percent and 5.1 percent shares, respectively.

During an October trip to China, Apple CEO Tim Cook said in an interview with local media that "it's just a matter of time" before China "becomes Apple's biggest revenue contributor". Cook also noted that Apple has plans to increase the number of retail stores in China from 15 to 40 during the next few years.

Eddy Cue, Apple's senior vice-president of Internet Software and Services, said in a November press release that China is already one of the company's largest markets.