Apple, Xiaomi won big as Samsung's smartphone struggles continued in third quarter

A showdown between Samsung and Chinese will spur on better smartphone designs going forward

A successful iPhone 6 launch in the U.S. helped Apple increase its share of the smartphone market in the third quarter, but nemesis Samsung Electronics struggled, with upstart Chinese manufacturers nipping at its heels and growing ever stronger.

Thanks to record sales in emerging markets and the popularity of Apple's new iPhone 6 and 6 Plus, overall smartphones sales to end users grew 20.3 percent to reach 301 million units during the third quarter, market research company Gartner said in its "Market Share: Devices, All Countries, 3Q14 Update" report on Monday.

Samsung's struggles continued unabated in the quarter. While the overall market grew, Samsung's sales dropped by about 9 percent to 73.2 million units. That was enough for a 24.4 percent market share, which still makes it the largest vendor by a large margin.

Samsung's product development team became too cautious, and paid a high price with the Galaxy S5, which failed to catch on with buyers. It is now under pressure to develop cooler products across its whole portfolio. The launch of the Galaxy Note 4 Edge with its curved screen has already showed that Samsung is willing to break new ground in the high-end segment. And the recent launch of the Galaxy A3, which has a metal unibody, shows the company is willing to use premium materials even on its lower-priced devices to claw back market share.

Apple was the second largest vendor with a 12.7 percent share. Its sales grew by 26 percent to 38.2 million units, thanks to the success of the two iPhone 6 models. The two smartphones were so popular in the U.S. they helped that market grow by almost 19 percent in the third quarter, Gartner said.

Huawei may have taken the third spot, but fewer than one million units separated it from Xiaomi and Lenovo in fourth and fifth place. They sold between 15 million and 15.9 million units, putting their market shares were between 5 and 5.3 percent. Xiaomi had the highest growth of the quarter, with an increase of 336 percent driven by strong performance in China where it became market leader.

To continue to grow, all three Chinese companies are dependent on selling more smartphones outside their home market. Lenovo has laid the groundwork for an international expansion with its acquisition of Motorola Mobility from Google. Xiaomi seems to be taking a more cautious approach: recently the company said it was scaling back its international aspirations to focus on India and Indonesia.

Attractive, lost-cost LTE smartphones will offer a chance for these companies to grow. While the high-end segment has become saturated for everyone but Apple, the market for more affordable products is still expected to grow.

During the third quarter, emerging markets (where consumers' budgets are smaller) exhibited some of the highest growth ever recorded with Eastern Europe and the Middle East and Africa growing almost 50 per cent year-over-year, according to Gartner.

This plays to the strength of the Chinese vendors, which is to undercut the leaders' prices and offer top specs for buyers who want premium phones, but can't afford Apple's or Samsung's high-end products, according to Gartner. The availability of next-generation components will allow manufacturers to build smartphones with LTE connectivity and HD screens that will sell for less than US$200 without a contract next year.

In the third quarter, smartphones accounted for 66 percent of the total mobile phone market; Gartner thinks that by 2018, nine out of ten phones will be smartphones.

Send news tips and comments to mikael_ricknas@idg.com

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags Huawei TechnologiesAppleconsumer electronicssmartphonesSamsung ElectronicsMobile OSesLenovomobileXiaomi

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Mikael Ricknäs

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?