Apple Inc. (NASDAQ:AAPL) reported impressive sales growth in the fourth quarter of 2025, even as overall U.S. smartphone sales increased by only 1% year-over-year (Y/Y).
Weak low-end and premium Android sales held back overall growth.
Apple’s Record Sales Push Market Share to 69%
Apple achieved its best sales quarter, expanding its market share to 69%, while Motorola rose to the #1 spot in the sub-$300 category with its new Moto G 2026 series devices, according to Counterpoint Research.
Apple’s market share reached 69% in the fourth quarter of 2025, up from 65% in the previous year, driven by strong sales of its iPhone 16e and 17 models in the mid-range and premium segments, the report noted.
The company benefited from increased promotional efforts by major U.S. carriers AT&T Inc. (NYSE:T), T-Mobile US, Inc. (NASDAQ:TMUS), and Verizon Communications Inc. (NYSE:VZ).
AT&T had its highest share of Apple sales to date at 89%, while T-Mobile and Verizon both saw Apple share increases compared to the fourth quarter of 2024. The iPhone 17 Pro Max was the top seller in all three channels.
“Premium devices are generally the major driving factor of sales in Q4 due to the heavy emphasis on postpaid deals,” said Maurice Klaehne, senior research analyst at Counterpoint. “Apple was able to benefit from these deals, as many offers were targeted toward iPhone and iOS device bundles.”
The mid-range price band ($300-$600) grew by 27% Y/Y, driven by consumers opting for more affordable devices due to macroeconomic conditions.
Apple and Alphabet Inc.’s (NASDAQ:GOOGL) (NASDAQ:GOOG) Google, with devices like the iPhone 16e and Pixel 9a, gained share in this segment, while Samsung Electronics Co., Ltd (OTC:SSNLF) and Motorola lost ground due to the increased competition, the report said.
Sub-$300 Market Struggles Amid Supply and Demand Issues
The sub-$300 price segment declined by 7% Y/Y, driven by weak demand and consolidation in low-end smartphones.
However, Motorola surged ahead of Samsung in this segment, bolstered by the launches of the Moto G Play 2026 and Moto G 5G 2026.
The report warned that surging memory prices in 2026 could sharply pressure low-cost smartphone makers, with bills of materials expected to rise by at least 15% over the next two quarters. The impact is likely to be most severe in the sub-$300 segment, where margins are already thin, raising the risk of further industry consolidation and forcing manufacturers to pass higher costs on to consumers.
At the same time, analysts are watching whether momentum in the $300 to $600 segment can be sustained beyond the holiday season. Continued growth in mid-range devices alongside softer premium demand would signal that consumers are trading down amid ongoing macroeconomic uncertainty in the U.S.
Apple Shifts Focus to High-Margin Premium Devices
Recent reports indicated Apple is adjusting its 2026 product strategy to focus on high-margin premium devices as chip shortages constrain supply.
The company plans to prioritize the production of its top three devices, including its first foldable iPhone and two premium models with upgraded cameras for a flagship launch in the latter half of 2026. As a result, it had to delay the standard iPhone 18 release until 2027.
During its earnings call, Apple executives confirmed that supply chain challenges are limiting the company’s ability to meet rising handset demand. While CEO Tim Cook acknowledged that rising memory prices had minimal impact in the December quarter, he warned that the AI-driven memory shortage would have a more significant effect in the March quarter.
The main challenge lies in securing advanced manufacturing nodes from Taiwan Semiconductor Manufacturing Co. Ltd (NYSE:TSM), where Apple is seeking 3-nanometer production.
Despite these supply challenges, Apple remains confident in demand.
The company reported impressive fiscal first-quarter results, posting revenue of $143.76 billion, above expectations.
The iPhone segment led the growth, with sales rising to $85.27 billion, up from $69.14 billion last year.
AAPL Price Action: Apple shares were up 0.19% at $270.00 during premarket trading on Wednesday, according to Benzinga Pro data.
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