Apple is worth $3 trillion. It also has a few obvious problems.

• Apple is heading into 2024 as the world's most valuable company again.
• The company's share price is high, but hardware sales and China are areas of weakness.
• The latest setback: Pausing US sales of the newest Apple Watch at peak holiday buy time.

It's easy to think of Apple as near-invincible.

It is, after all, on course to end the year as a $3 trillion mega cap. That position comfortably makes it the world's most valuable company for the fifth year running.

But 2023 has given Apple the occasional headache. Heading into 2024, here are some of its biggest challenges.

1. New Apple Watch sales

Apple announced on Monday that it would stop selling two Apple Watch models — during the critical holiday period.

The Apple Watch Series 9 and Ultra 2 won't be available for purchase from its US online store from December 21 and its physical stores from December 24. The decision followed a rare loss for Apple in a patent dispute with Masimo, a health-tech company.

The International Trade Commission ruled earlier this year that a blood oxygen sensor in Apple's newest watches violated patents held by Masimo. The US body issued a "limited excursion order" against Apple's wristwear in October.

Apple will likely have a workaround ready swiftly, but the sales pause is still a blow.

Apple might be able to settle with Masimo, but settling is outside its comfort zone. The firm's settlement with Qualcomm over access to 5G chips in 2019 was a big deal, after Apple accused the chip firm of overcharging in a $1 billion lawsuit.

Engineers are readying a software update to address issues with the watches, per Bloomberg's Mark Gurman. The move was described as a "high-stakes engineering effort unlike any Apple has undertaken before."

2. The Vision Pro's success

Next year, Apple will introduce the world to the Vision Pro. The $3,499 mixed reality headset, which will reportedly go on sale in early 2024, marks the start of Apple's biggest hardware push since the launch of the iPhone in 2007.

Early predictions suggest it might struggle to reach similar levels of success as the iPhone, which is Apple's biggest revenue driver. In Apple's most recent quarter, iPhones generated $43.8 billion in net sales, roughly 50% of overall net sales.

No one expects the Vision Pro to come close to this in the short term, but the sales is underwhelming even with tempered expectations.

Analysts at research firm Canalys estimate that just 350 Vision Pro units will be shipped in its first year, though they predict this to increase to more than 12,600 within five years.

Rex Woodbury, managing partner at VC firm Daybreak, wrote on Substack that "after a slow 2024 start, sales will increase as Apple drops the price and as killer apps emerge."

It's possible, but high risk. Apple's major rivals in this area, such as Meta have yet to convince a mainstream audience of the merits of augmented- and virtual-reality.

3. China

The other big issue facing Apple right now is its position in China.

The country is Apple's most important international market, but bigger factors put its position at risk.

A week before the release of the iPhone 15, Apple suffered a $200 billion market-cap drop. That's partly attributable to the emergence of a major Chinese competitor — Huawei's 5G Mate 60 Pro — and to reports of a government crackdown on iPhones.

China's reaction to the homegrown phone was patriotic. And first-month sales of the iPhone 15 in China were 6% lower than the iPhone 14 over the same period the prior year, according to Bloomberg, citing data from market researcher GfK.