While Apple was the number one smartphone maker in Q1-25 Globally, Apple landed in fifth place in China in Q1-25. IDC didn’t clarify if that was for all of China or just Mainland China, which is the norm for most analytical reports. Usually when Hong Kong isn’t included, Apple’s position worsens.

With that said, IDC notes that China's smartphone market shipped 71.6 million units in 1Q25, a 3.3% year-on-year (YoY) increase. This growth was driven by the government subsidies that extended to smartphones in January 2025, as well as the peak sales season of the Spring Festival. The market outperformed the global growth of 1.5% but came below IDC’s projections as the effect of the government subsidies on bolstering existing consumer demand appeared to be modest.

The vast majority of Government subsidies went to phones below Apple’s retail prices which artificially boosted local smartphone vendors. Will Wong, senior research manager for Client Devices at IDC Asia/Pacific stated that "Apple declined as its premium pricing structure prevented it from capitalizing on the subsidies." As if China wanted to assist Apple over local OEMs. Apple certainly got the short end of the stick on China’s subsidies.

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Wong confirmed this by noting that "Xiaomi stood out as it regained the top spot after nearly a decade, a resurgence largely fueled by government subsidies that resonated with its value-conscious customer base.”

Arthur Guo, senior research analyst in Client System Research for IDC China added that “Looking ahead, the market is expected to face challenges as the US-China trade tensions may lead to cost increases and tighter consumer budgets.”

Perhaps Apple will have to shave a little on the iPhone 16e pricing to get in on future Government subsidies to boost sales during the U.S.-China tariff war.