Smartphone sales of Huawei Technologies on the mainland surpassed those of Apple in August - the first time in 46 months, according to a new report by research firm CINNO - as the US-sanctioned company continues to ride on the success of its 5G handset comeback last year.

That aligned with findings from government think tank China Academy of Information and Communications Technology, which reported a 12.7 per cent year-on-year decline in foreign smartphone shipments, including Apple's iPhone, in the same month. Those shipments fell to 1.87 million units in August, from 2.14 million a year earlier, as domestic smartphone shipments rose 26.7 per cent to 24.05 million during the same period.

CINNO did not immediately respond to a request for comment on Thursday.

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Competition between Huawei and Apple in the world's biggest smartphone market has taken on new significance, as the Shenzhen-based telecommunications equipment giant has seen a revival of its handset business amid the US tech giant's recent struggles on the mainland.

Strong demand for Huawei's high-end handset models, such as the Mate and Pura series, as well as foldable smartphones like the recently launched Mate XT, helped lift the firm's average selling price and wholesale revenue to record highs in the second quarter, according to TechInsights. It said China remains Huawei's core market, accounting for 89 per cent of its global smartphone shipments.

China's smartphone market has steadily gained momentum this year, with more consumers gravitating towards local brands. Huawei, which leads the market, had a 17.5 per cent share in the first half, when total domestic shipments exceeded 140 million units to grow 7.7 per cent from a year ago, according to data from research firm IDC.

Huawei's Mate XT trifold 5G smartphone generated plenty of buzz last month, when it was released on the same day Apple's iPhone 16 series hit store shelves in almost 60 countries.

Ahead of the new iPhone's release, Apple fell out of the top-five smartphone vendor rankings in China during the second quarter. Apple's market share on the mainland shrank to less than 14 per cent, according to IDC.

The Cupertino, California-based tech giant's revenue in the Greater China region - comprising the mainland, Hong Kong and Taiwan - reached US$14.73 billion in the June quarter, down 6.5 per cent from the same period last year.

Customers inside an Apple Store in Shanghai when the iPhone 16 series was officially released in almost 60 countries on September 20, 2024. Photo: Bloomberg alt=Customers inside an Apple Store in Shanghai when the iPhone 16 series was officially released in almost 60 countries on September 20, 2024. Photo: Bloomberg>

Apple's iPhone assembly orders mostly remained unchanged from previous market estimates, according to Kuo Ming-chi, an Apple-focused analyst at TF International Securities.

"Suppliers had been asked to continue producing two [iPhone 16] Pro models during China's National Day holiday, indicating that demand for the Pro models has generally met expectations so far," Kuo wrote in an X post on Wednesday.

While Apple chief executive Tim Cook had expressed confidence over the firm's long-term prospects in China, mainland consumers' enthusiasm for the iPhone 16 has suffered because Apple Intelligence - the firm's on-device artificial intelligence (AI) system - will not be available in the Chinese language until next year. Generative AI systems are also heavily regulated in the country.

"The next focus will be the impact on US market demand [or] shipments after Apple Intelligence becomes available in late October," Kuo said. He maintains his previous production estimate for the iPhone 16 series at 88 million to 89 million units in the fourth quarter.

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