12:59 PM EST, 03/05/2024 (MT Newswires) -- Apple's ( AAPL ) iPhone sales declined by double digits in the key Chinese market through the first six weeks of 2024 as the company underperformed key competitors, according to Counterpoint research published Tuesday.

Overall smartphone sales were down 7% on a year-over-year basis in the first month-and-a-half of 2024, with unit sales of the iPhone dropping 24%, according to the research report. Other brands to post declines include OPPO, down 29%, Vivo, down 15%, and Xiaomi, down 7%.

Huawei largely outperformed the group with a 64% surge in unit sales over the first six weeks, while sales of Honor phones edged up 2%. "Primarily, (Apple ( AAPL )) faced stiff competition at the high end from a resurgent Huawei while getting squeezed in the middle on aggressive pricing from the likes of OPPO, vivo and Xiaomi," Counterpoint Senior Analyst Mengmeng Zhang said.

Since the iPhone 15 "has no significant upgrades from the previous version," many consumers are comfortable holding onto their older-generation models for longer, she said. Apple ( AAPL ) did not respond to a request for comment regarding the China slowdown. Its shares fell 2.5% in midday trade.

The early 2024 decline also reflects tough comparables, with the first few weeks of 2023 seeing abnormally high numbers as unit sales were deferred from December 2022 amid production issues, Counterpoint said.

While sentiment is "dismal" with the China headwinds, Wedbush Securities analyst Daniel Ives separately said there's reason to remain bullish on Apple ( AAPL ) amid pent-up demand heading into the iPhone 16 launch and artificial intelligence advancements. Wedbush reiterated its outperform rating and $250 price target on the stock Tuesday.

"Over the last decade we have been through many challenging periods in the Apple ( AAPL ) story and we handheld investors through these stormy periods just like today," Ives said. "This is no different and in our view brighter days will be ahead for Apple ( AAPL ) although right now the China story remains the dark cloud over the name in the near-term."

The brokerage continues to expect "flattish" iPhone numbers for the year, even with the March quarter fielding difficult China comps. Current iPhone estimates for 2024 are still hittable, and 2025 consensus estimates are conservative, according to Ives.

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