Apple (NASDAQ: AAPL) stock could be impacted further as the technology giant faces renewed headwinds in China, one of its critical markets, where iPhone shipments are declining.
Indeed, AAPL stock price has had a challenging past year as investors remain on edge, partly due to the lukewarm reception of the company’s flagship product.
At the close of the last trading session, Apple stock was valued at $213.49, up 1.8%, but in 2025, the equity has lost 12% of its value year-to-date.
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China’s declining iPhone shipments and AAPL stock impact
Now, among foreign-branded phone shipments, Apple took one of the biggest hits, with iPhone sales dropping 20.6% year-over-year (YoY) to 4.4 million units in January, according to data from the China Academy of Information and Communications Technology (CAICT).
This decline comes amid a broader slump in China’s smartphone market, with total phone shipments decreasing 14.3% YoY to 27.2 million units.
Notably, the new data from China could hinder Apple’s recovery, as the region has long been a key growth driver for its flagship product.
The decline is partly driven by competition from domestic brands like Huawei and Xiaomi, macroeconomic pressures, and a shift in consumer preference toward more affordable alternatives.
Adding to the challenges, iPhone shipments could face further declines amid the escalating U.S.-China trade war, with tariffs introduced by President Donald Trump and retaliatory measures intensifying the strain.
The CAICT data aligns with market research reports noting China’s softening demand for premium smartphones. Apple has struggled in the country’s premium segment, hindered by a lack of AI features, as foreign options such as ChatGPT and similar tech remain unavailable.
Meanwhile, Vivo and Huawei have thrived by offering feature-rich devices, foldables, and advanced operating systems like Huawei’s HarmonyOS NEXT and Xiaomi’s HyperOS, which high-end users prefer.
The stakes are high for Apple, as China accounts for nearly 20% of its global revenue. A sustained decline in iPhone shipments could weigh heavily on AAPL’s stock price, which has already faced volatility in early 2025 amid concerns over slowing growth.
Recognizing China’s significance, Apple is taking measures to regain market share. In this line, the company recently partnered with Alibaba (NYSE: BABA) to introduce Apple Intelligence in the country. The move benefits both firms, as China’s AI market is growing increasingly competitive, with Alibaba aiming to counter the rise of DeepSeek.
Wall Street divided on AAPL stock
With a multitude of Apple fundamentals emanating from China, Wall Street remains divided on the firm’s prospects.
For instance, following the Alibaba partnership, Jefferies analyst Edison Lee expressed skepticism, cautioning that Apple may struggle to leverage app data for AI services. He noted that Chinese consumers predominantly rely on third-party local apps instead of Apple’s first-party applications, limiting the company’s ability to tailor AI features effectively.
On March 13, Wedbush Securities’ Dan Ives argued that while Apple has struggled with AI rollouts, investors dumping the stock may regret it. He called the recent selloff an overreaction, maintaining a $325 price target and predicting Apple will sell up to 230 million iPhones this year. Ives believes the Alibaba AI partnership could be a game-changer, estimating it could generate $10 billion in AI-driven revenue by 2027.
On March 12, Morgan Stanley’s Erik Woodring cut his AAPL stock price target to $252 from $275, citing weak iPhone demand amid Siri upgrade delays. However, he maintained an ‘Overweight’ rating on the stock.
Overall, Wall Street remains bullish on Apple, with 32 analysts at TipRanks setting an average price target of $249.38, an upside of nearly 17% over the next 12 months. The highest target is $325, while the lowest is $188.
Featured image via Shutterstock
