Apple's market share in China is at its lowest level since 2009, according to a new report published by research firm Canalys. Canalys found that 238.1 million smartphones units were shipped during the second quarter of this year, which represents a 50 percent bump from the number of shipments last year. Apple and Samsung both managed to ship more devices this year, but still lost market share in China.

According to Canalys, Samsung and Apple both lost share to local Chinese smartphone sellers, including Lenovo, Yulong, Huawei, ZTE and Xiamoi. The top 5 vendors in China include Apple, Samsung, Lenovo, Yulong and LG, though Canalys didn't list them by market share and only noted that Apple's share in the country is its lowest since the first quarter of 2009.

"The high end of the market continues to grow but there is no doubt that the explosive growth will come from the low end of the market," Canalys vice president and principal analyst Chris Jones said. "Apple needs to respond to this dynamic and it is evident from the performance of its older models this quarter that there is real demand for a new low-cost iPhone. The challenge that it faces is maintaining high margins on arguably the most important products in its portfolio."

Apple's rumored iPhone 5C is expected to target emerging markets, specifically China, and CEO Tim Cook recently spent time catering to local Chinese carriers, including the chairman of China Mobile. China Mobile is the world's largest wireless carrier but operates its own TD-SCDMA network, which has created roadblocks in the past for Apple. Considering the rapid growth of China's smartphone market, however, this isn't an arena where Apple can afford to sit on the sidelines.