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This could spell trouble for Apple

Talking Numbers

Apple isn't just losing market share with smartphones, it's also taking hit on its tablets' market share. Are tough times ahead?

We’ve heard about the tough battle between Apple and Samsung over smartphones in China. But, Apple now finds itself under siege with another one of its signature devices – the iPad tablet.

Research company IDC says that Apple has seen its share of sales in tablets fall from 50% of units shipped in first quarter of 2013 to 28% of the 5.2 million tablets shipped in China for the second quarter. Apple’s nearest rival, Samsung, had 11% and China’s own Lenovo was at 8%.

So, who had the other 52%? Small, local startups using Google’s Android operating system.

(Read more: Cheaper rivals eat into Apple’s China tablet share)

The iPad’s diminishing market share isn’t just confined to China, according to other data compiled by IDC. Worldwide, Apple’s 14.6 million units shipped represent 32.4% of total units shipped in Q2. Last year this time, it had 60% of units shipped. Meanwhile, Samsung nearly quadrupled its sales from 2.1 million units in the second quarter of 2012 to 8.1 million units in Q2 of 2013.

So, will Apple continue to play defense as it watches one of its most beloved products lose out to Samsung and other companies using Google’s Android?

(Watch: Boosts ahead for Apple stock: Analyst)

John Stephenson, portfolio manager at First Asset Investment Management, takes a look at Apple’s fundamentals. He says there are valuation reasons why Apple deserves a look. On the charts is Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson.

To hear Stephenson and Ross analyze Apple, watch the video above.

[Disclosures: Stephenson and First Asset Investment Management both own shares of Apple.]

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