iPhone sales drop, Apple decides to spend big in China

With stiff competition from Huawei and other prominent domestic smartphone makers, Apple is doubling down on its research efforts to stay ahead of the game, according to PhoneArena . In a statement to SCMP , the iPhone maker revealed its intention to strengthen its research center in Shanghai, focusing on supporting all of the company's product lines.

Pressure from falling sales forces Apple to spend more in China

Additionally, Apple plans to open a new lab in Shenzhen in the second half of 2024. This new facility will be dedicated to testing and research, focusing on key products such as iPhone, iPad and Vision Pro glasses.

The company stressed that the upcoming Shenzhen facility will strengthen cooperation with local suppliers and provide support for local employees. Isabel Ge Mahe, Apple's vice president and general manager for Greater China, said she is proud to foster stronger connections in China and expand the company's footprint there. Isabel said the company has invested $139.2 million in its existing applied research lab in China.

The recent moves follow Apple’s commitment to ramp up capital spending in China, its third-largest market globally after the Americas and Europe . The strategy shift follows a 24% decline in iPhone sales in China in the first six weeks of 2024. The company faces stiff competition from a resurgent Huawei in the high-end segment, as well as pricing pressure in the mid-range from heavyweights like Oppo, Vivo and Xiaomi.

Recently, the US tech giant also made a move to cope with sluggish sales and increasing competition from Huawei by cutting prices for the iPhone 15 series in China.

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