Apple may have 'hit a ceiling' in China as sales fall 14%, but CEO Tim Cook is still 'enthusiastic'

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Apple CEO Tim Cook attends China Development Forum 2017 – Economic Summit at Diaoyutai State Guesthouse on March 18, 2017 in Beijing, China.

There’s concern that Apple won’t see the growth in China that it experienced when it released the iPhone 6 Plus – it’s first large screen device.

“China is roughly a 100 million shipment market per quarter, with the premium segment accounting for close to 25 percent of the market on average. Apple has hit a ceiling in terms of the total premium market it can capture,” Neil Shah, research director of devices and ecosystems at Counterpoint Research, told CNBC by phone on Wednesday.

“Those who wanted an iPhone already have one, and the upgrade cycle for iPhone has extended in China. Previously they used to have strong sales in older generation iPhones, but that is not happening because in that segment, Oppo and Vivo are putting good handsets and taking away share from Apple.”

China growth ahead?

But Apple is reportedly gearing up to launch three new iPhones later this year with one being a special anniversary edition boasting a souped-up camera and display. This could help it regain favor with Chinese consumers.

“Edge to edge screen technology which maximizes screen size for gaming, video and best suits Chinese language is in future products and that will help Apple in China for sure,” Neil Campling, head of global technology, media, telecom research at Northern Trust Capital Markets, told CNBC by phone on Wednesday.

“I do think Apple will return to growth in China and that will come through most clearly I suspect in this March quarter next year.”