During Apple’s 2026 Worldwide Developer Conference, Apple Intelligence took center stage with its promising enhancements. However, one question lingered – how will Apple bring Apple Intelligence to the Chinese market, its second-largest iPhone market?
Counterpoint Research says the answer came this week when Apple received Chinese regulators’ approval to roll out Apple Intelligence on iPhones in the country, with Alibaba and Baidu serving as technical partners. Six other smartphone players – Samsung, Huawei, OPPO, vivo, Xiaomi and ZTE – have also received similar clearances for on-device GenAI.
According to Counterpoint Research’s Apple 360 Service, there are close to 95 million Apple Intelligence-capable iPhones in use in China, a country where the brand’s consumers have been anxiously waiting for the AI experience already available in other countries.
On-device AI is very important for Apple, notes the research group. Out of the five Apple Foundation Models (AFM), two – the 3-billion-parameter AFM Core and 20-billion-parameter AFM 3 Core Advanced (using sparse activation) – run on the device.
Alibaba’s Qwen Large Language Models would be reportedly integrated into Apple Intelligence experiences within iOS, iPadOS, macOS and visionOS for users in China. This will give users the ability to access Qwen capabilities like text and image comprehension and generation, without needing to jump between tools, according to Counterpoint.
Qwen’s role here would be different than that of Gemini’s (Google’s LLM), with a deeper and probably more visible integration in use cases. AFM 3 Cloud Pro is built using Gemini model technology (which Apple licensed), but with actual inference happening on Apple’s private cloud compute. Counterpoint says this model might not be possible in China, where the data would likely have to reside with a local cloud player. However, exact hosting requirements aren’t yet clear.
While the regulatory permission refers to “mobile”, which can be interpreted as iPhone, Alibaba’s statement indicates Qwen’s capabilities will also be available in iPad, Mac and XR, which Apple is expected to unveil in the future. This makes sense because for Apple, Apple Intelligence is an ecosystem strategy with cross-platform play being a key differentiator, according to Counterpoint.
The permission is specifically for on-device AI, whose role becomes important, especially from the data privacy point of view in China. Counterpoint predicts that, going forward, Apple will aim to prioritize on-device AI use cases that leverage its proprietary hardware instead of relying on resource-intensive cloud AI – especially in China, where it might not be able to own the cloud stack completely. At the same time, as Siri becomes more personal, it will be tied to the user’s data, which users will want to keep on their own devices, an area where on-device processing will be helpful.
The regulatory approval brings Apple into the AI race in China, a market arguably among those showing the highest consumer AI awareness and preference in the world. Counterpoint says it’s also important to understand that China’s AI race is being fought on use cases, not model size.
Competitors like Huawei are pursuing hybrid and full-stack AI strategies spanning silicon, OS and on-device models. That is why China is the one market where Apple has had to fundamentally redesign its AI strategy, which required partnering with local players not just for models and search but likely across the stack, including data storage and cloud infrastructure. If Apple can execute its AI in China, it will be a big challenge for Huawei, which does not have access to the advanced chips to support heavy AI workloads, notes Counterpoint.
For more research, check out the research group’s Apple 360: Forecast Assumptions by Product Category, Q1 2026.
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