China challenges Apple as it prepares to launch its first foldable smartphone

Chinese smartphone giants Huawei and Xiaomi have launched new foldable devices in their home market just days ahead of Apple’s widely anticipated entry into the premium foldable smartphone segment. The moves underscore rising competition in the high-end foldable category, where Chinese manufacturers are looking to solidify their positions as global rivals ramp up their offerings.

On Monday, Huawei introduced the Mate XT 2, an ultra-premium trifold smartphone featuring two folding mechanisms. The latest iteration builds on the Mate XT, released two years ago, and comes with a starting price of 19,999 yuan (approximately $2,980), according to Bloomberg. This marks an increase of around 10 percent compared to its predecessor, which the company attributes partly to the growing difficulty in securing memory components. The Mate XT 2 features 16GB of memory and 256GB of storage in its base model, and can transform from a regular smartphone into a 10.2-inch tablet.

A significant technical innovation in the Mate XT 2 is the introduction of Huawei’s LogicFolding chip design philosophy, with the Kirin 9050 Pro processor being the first chip produced under this initiative. Earlier, Huawei semiconductor chief He Tingbo outlined the company’s approach to developing advanced semiconductors amidst US-led restrictions on access to state-of-the-art lithography tools. Ahead of the phone's launch, He published a paper addressing industry concerns about potential overheating, noting that the new chip offers significant reductions in power consumption, while delivering 55 percent more transistors per square millimeter and up to 66 percent lower power use for some key tasks. The Mate XT 2 is set to go on sale in China from Saturday.

Just hours later, Xiaomi CEO Lei Jun took the wraps off the Xiaomi 18 Fold, aiming to further strengthen domestic supply chains with memory supplied by CXMT Corp and Xiaomi’s own Xring O3 processor. The Xiaomi 18 Fold starts at 10,999 yuan for the 256GB variant and sports a passport-like design reminiscent of the style expected for Apple’s upcoming foldable iPhone. “Right now, memory is very expensive. So our pricing isn’t cheap but it’s definitely good value for your money,” Lei said at an event in Beijing.

The timing of these launches highlights both the challenge and the opportunity presented by Apple’s expected foldable iPhone announcement, forecasted for Wednesday. Analysts believe Apple's vast premium user base could catalyze broader adoption of foldable devices. According to Counterpoint analyst Ivan Lam, Apple’s entry is likely to quickly claim significant market share and encourage other manufacturers. He said Apple could capture a quarter of the global foldable smartphone market in 2024 and potentially become the market leader with a 41 percent share next year, based on projections from Smart Analytics Global.

The premium push comes as Chinese smartphone makers grapple with rising memory costs and a deeper decline in the broader market. Industry tracker Counterpoint estimates smartphone shipments will see their sharpest contraction on record this year, with volumes expected to fall 14 percent, and Chinese brands face intensified pressure due to their large exposure to budget segments that cannot easily absorb cost increases. In response, companies like Huawei, Xiaomi, and Honor have raised prices, according to local media Jiemian, and are shifting focus to higher-margin categories such as foldables.

Xiaomi’s profit has declined for three straight quarters as it works to reduce shipments of low-end models, while Huawei, despite continued shipment growth, saw profits fall in the first half amid efforts to stockpile components. Both brands see the premium foldable segment as a critical battleground as they position their latest devices just ahead of Apple’s long-awaited entry. With Apple’s arrival expected to shake up market dynamics, the spotlight is now firmly on whether Chinese makers can hold their ground in the intensifying global race for foldable smartphones.