Withstanding the pressure of rising chip prices, Apple's iPhone Q4 shipments surged by 28%, reclaiming the top spot in the Chinese smartphone market

Despite facing the increasingly severe challenge of a critical shortage of storage chips, Apple has regained the top spot in the Chinese smartphone market with strong market performance during the holiday season. Driven by demand for the iPhone 17 series, Apple's fourth-quarter shipments in China surged 28% year-on-year, demonstrating the unique resilience of high-end devices in a turbulent market environment.

On January 19, Bloomberg cited data from Counterpoint Research indicating that in the quarter ending in December, Apple's smartphones reclaimed the top position, accounting for one-fifth of the total shipments in the Chinese market. For the full year of 2025, Apple's shipments in China grew by 7.5%, closely following the leading domestic competitor Huawei with approximately 17% market share, with a very small gap between the two.

Reports indicate that the industry is currently facing a severe shortage of semiconductors used for device data storage, primarily due to storage chip manufacturers shifting more capacity to produce high-end artificial intelligence storage chips for Nvidia. Although this shortage has driven up prices and squeezed smaller manufacturers that cannot secure long-term supplies, Apple has effectively resisted the impact of supply chain fluctuations due to its high-end market positioning.

Analysts indicate that price pressures on storage chips are expected to persist until the first half of 2026. Counterpoint analysts predict that storage prices will further increase by 40% to 50% in the first quarter of 2026, followed by an additional rise of about 20% in the second quarter. This will force smartphone manufacturers to optimize their product portfolios, particularly cutting back on low-end models to maintain profit margins.

High-End Market Shows Resilience

Against the backdrop of an overall market decline, high-end smartphones have demonstrated immunity to the storage chip crisis.

According to an article mentioned by Wall Street Insight, TSMC CEO C.C. Wei emphasized the uneven impact of the storage shortage on the market during a recent earnings call, noting that high-end smartphones are minimally affected.

According to Bloomberg, since all of Apple's products are positioned at the high end of the market, they have shown the greatest resilience.

For the full year of 2025, Apple's shipments in China grew by 7.5%, closely following the leading domestic competitor with approximately 17% market share, with a very small gap between the two.

Additionally, a new round of consumer subsidy policies in China has also helped manufacturers alleviate cost pressures to some extent.

Despite Apple's overall strong performance, there are some blemishes in its product lines. The new iPhone Air was released later in China than in other regions, and its sales performance did not meet expectations.

Counterpoint analyst Ivan Lam stated:

"The performance of the iPhone Air has been poor. The later release date and the compromise between the slimness of the body and functionality have led to a slow start."

This indicates that even market leaders can suffer from missteps in product strategy and timing of releases, which can drag down the sales of a single model, although this has not shaken Apple's leading position in overall quarterly shipments

Warning of Soaring Storage Chip Prices

From Micron to terminal device manufacturers, an increasing number of companies are beginning to issue warnings about the uncertainty of the shortage of storage semiconductors. This shortage is not only driving up costs but is also reshaping the market landscape.

Counterpoint analysts wrote in their report:

"Looking ahead, storage prices are expected to rise significantly further. Smartphone original equipment manufacturers (OEMs) are expected to optimize their product portfolios, focusing on reducing low-end models to maintain profit margins."

This trend means that in an environment of high chip costs, brands with high pricing power will have a competitive advantage over brands that rely on low-margin volume sales