🧠 Food for thought

Implications, context, and why it matters.

A government subsidy program helps explain Apple’s counter-market growth

• China’s government started a national subsidy program on January 20, 2025, and extended consumer support to smartphones and other personal electronics 1.
• The plan gives a 15% discount on smartphones priced under 6,000 yuan (US$880), with a 500 yuan (US$73) cap per item 1.
• apple CEO Tim Cook said the subsidies “had some effect” on performance in Greater China 2. He called it “the first full quarter of the subsidies playing out” 2.
• As of March 2025, more than 42 million consumers had applied, generating 67 billion yuan (US$9.82 billion) in sales 1.

Apple’s short-term win still faces pressure from domestic rivals and higher memory costs

• A memory-chip crunch is pushing up production costs, and it is expected to force compromises across the smartphone market through 2026 3.
• Counterpoint says Apple can absorb higher memory costs thanks to supply chain control, and it may be less likely than competitors to raise prices 3.
• Counterpoint says Oppo and Vivo have raised prices on some existing models as memory costs climb 3.
• Counterpoint says Huawei may benefit from domestic suppliers that tend to charge less than international memory-chip makers, which could help it gain share in low-to-mid-range phones 3.