Apple now neck-and-neck with Samsung after monster quarter

As iPhone 6 propelled Apple, Samsung sales dropped because of competition in China

The huge popularity of the new iPhone 6 pushed Apple and Samsung closer than ever at the top of the market for smartphones, according to two companies that closely track shipments of the devices.

Earlier this week, Apple said it sold 74.5 million iPhones in the last three months of 2014 and on Thursday Samsung said it sold 95 million phones. That means Samsung remains the world's biggest mobile phone maker, but its numbers include both smartphones and feature phones.

Samsung doesn't break out its smartphone shipments, but Strategy Analytics said Friday that it estimates Samsung shipped 74.5 million smartphones in the quarter - leading to a tie in the smartphone market. Another industry analytics firm, IDC, said it estimates Samsung shipped 75.1 million smartphones, giving it a slim lead over Apple.

Whatever Samsung's exact shipments, the surge Apple enjoyed underlines the popularity of the iPhone 6 that was also reflected in the company's huge profits of $US18 billion in the quarter.

Over the last year, Apple's share of the smartphone market rose from 17 per cent to 20 per cent, according to IDC. Over the same period, Samsung's share slid from 29 per cent to 20 per cent.

Samsung's share is dropping in part because of competition from Apple at the high-end of the market, but a more serious concern is competition in the larger low- and mid-range markets from Xiaomi, Huawei and ZTE. The three Chinese makers are improving their offerings, delivering better-quality handsets at competitive prices, and consumers are buying them.

Illustrating the effect of that competition, which is particularly strong in China: Samsung's operating profit in its mobile division sank 64 percent in the quarter, it said on Thursday. In response, it plans to streamline its various families of mobile phones.

Both companies remain well ahead of third-placed Lenovo, which was helped by its acquisition of Motorola's smartphone business. Lenovo had a 24.7 million smartphones - a third that of Apple and Samsung - according to the estimates. Huawei was ranked fourth and Xiaomi ranked in fifth place.

Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

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