The decline in Apple's sales was the primary catalyst for an overall double-digit drop in China smartphone shipments for the first week, according to a note the brokerage published on Sunday. Other Android brands and Huawei achieved relatively flat growth year-over-year during this period, the note said.

This decrease in Apple's sales took place despite aggressive discounting of multiple iPhone models through major Chinese online marketplaces, according to the research note. For example, the iPhone 15 Pro and iPhone 15 Pro Max received a 16% price reduction on the e-commerce platform Pinduoduo in the first week of 2024.

The 30% drop represents an acceleration from the 3% year-over-year decline the U.S. company saw for all of 2023 in its third-largest market, Jefferies said, adding that the brokerage derived this from its own market tracking. Specifically, the 3% decline in 2023 equated to a 0.4% decrease in Apple's market share.

Jefferies analysts said Apple's decline is largely attributed to competitive pressures from Chinese rivals, especially Huawei, which launched its Mate 60 series of phones in August last year.

Apple and Huawei did not immediately respond to requests for comment.

The Mate 60 line is widely viewed as marking Huawei's comeback to the high-end smartphone market after years of U.S. sanctions that had previously hampered its progress.

For the final quarter of 2023, Huawei's share in the Chinese smartphone market rose by about 6%, according to the note.

According to the Jefferies analysts, Apple will likely face more competitive pressure from domestic rivals throughout 2024. Their forecast predicts Apple's shipment volumes will continue declining by double digits in 2024, while Huawei is expected to continue gaining market share.

Specifically, they estimate that Huawei will ship approximately 64 million smartphones worldwide in 2024 - up substantially from the estimated less than 35 million shipped in 2023. Following a years-long slump, the Chinese smartphone market is poised for a rebound other analysts have forecasted, with research firm IDC predicting unspecified year-on-year sales growth in the fourth quarter after ten consecutive quarters of falling shipments.