Late last night, Apple analyst Ming-Chi Kuo rattled off some observations about the current state of the smartphone market. His key points are as follows:

• "Android smartphone shipments in the Chinese market grew steadily YoY, mainly due to the low shipment base in 1Q23.

• iPhone shipments in the Chinese market continued to decline YoY. The price cuts at the beginning of the year have limited help to shipments."

Yet it has to be noted that Q4-23 smartphone shipments for Mainland China showed that Apple's iPhone was the #1 smartphone as well as for the full year (2023). So Kuo's "continued decline YoY" commentary about the iPhone doesn't reflect the facts. Apple grew market share for all of 2023 and for Q4-2023 specifically.  

•  The global sales momentum of foldable phones has slowed down recently. After revising its foldable phone shipment target from 15 million to 10 million units last year, Samsung plans to ship 12 million units this year, a relatively conservative target. The slowdown in sales in the Chinese market is due to brands other than Huawei gradually losing interest in less profitable clamshell models. Oppo and Vivo have even halted their plans to launch new clamshell models initially scheduled for 2024. 

•  Benefiting from GenAI, Samsung S24’s 2024 shipment forecast has been increased by about 5–10%. S24 already has the fundamental concept of future AI mobile phone design."

On Kuo's last point, we covered Samsung's Galaxy S24 Ultra AI features in yesterday's report titled "Apple to push fast and hard on the Generative AI front in 2024 in order compete for mindshare with Competitors Google, Microsoft and others." The new features include: "Circle it" (which is really a Google AI feature); Chat Assist;  Live Translate Calls; and Enhanced Zoom.

Samsung's tiny lead in AI features for their Galaxy S24 Ultra is likely to evaporate when the iPhone 16 launches in September.