Samsung’s smartphone division returned to shipment growth in the third quarter, the first increase in 18 months.
According to figures published by Strategy Analytics on Thursday, the Korean electronics make r shipped 83.8 million smartphones worldwide in the three months to 30 September, up from 79.2 million a year earlier.
The research firm said the growth was driven by select price cuts and the popularity of new models such as the Galaxy S6 Edge+, Note 5 and A8, among others.
"Samsung has finally returned to positive smartphone growth for the first time in six quarters since Q1 2014. Its smartphone division is back on the road to recovery," declared Neil Mawston, executive director of Strategy Analytics, in a statement.
In its financial report on Thursday, Samsung reported that its IT & Mobile (IM) division generated revenue of 26.61 trillion won (€21.18 billion) in the third quarter, up from KRW24.58 trillion a year earlier. Of that total, mobile handsets accounted for KRW25.94 trillion.
IM’s operating profit came in at KRW2.4 trillion (€1.9 billion), up from KRW1.75 trillion in Q3 2014.
"Large screen smartphones released in the quarter are receiving positive feedback from markets and they are expected to exceed in shipments reached by their predecessors," Samsung said, in a statement.
Despite the turnaround in performance, Samsung still faces growing competitive pressure.
According to Strategy Analytics, Samsung’s 83.8 million unit shipments gave it a smartphone market share of 23.7% at the end of the third quarter, down from 24.5% a year earlier.
Second-placed Apple, which shipped 48 million handsets in the quarter, increased its market share to 13.6% from 12.2%, while third-placed Huawei increased its market share year-on-year to 7.5% from 5.1%.
"Huawei is expanding rapidly across Asia, Europe and the United States, putting competitive pressure on key rivals such as Lenovo-Motorola and Xiaomi," noted Strategy Analytics director Woody Oh.
Lenovo-Motorola’s Q3 market share slipped to 5.3% from 7.6% a year ago, and Xiaomi’s market share edged down to 5% from 5.6%.
&quo t;Global smartphone shipments grew just 10% annually from 323.4 million units in Q3 2014 to 354.2 million in Q3 2015. This quarter was the smartphone industry’s slowest growth rate for six years, since the depths of the global economic recession back in 2009," said Linda Sui, director at Strategy Analytics. "Smartphone growth is slowing due to increasing penetration maturity in major markets of the U.S., Europe and China."
These sentiments were echoed by Samsung in its earnings report.
"In 2016, the growth rate for the smartphone market is expected to slow down continuously, compared with previous years. However, the company will reinforce its premium products and streamline the line-up to increase sales and to maintain solid business performance," the company said.
