China's Huawei, Lenovo took a big chunk out of Samsung's smartphone lead: IDC

The worldwide smartphone market grew by 23.1 percent year over year in Q2 2014, according to the latest report from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker.

Q2 saw vendors setting a new single quarter record of 295.3 million shipments, according to preliminary data, following a very strong first quarter. The market grew 2.6 percent sequentially, in line with IDC’s forecast. IDC expects shipments to surpass 300 million units for the first time ever in a single quarter in Q3.

Despite a challenging quarter for Samsung and Apple, the strong market demand boosted results for most smartphone vendors. Among the top vendors list, Chinese OEMs figure heavily. By far the most impressive, according to IDC, is Huawei, which nearly doubled its shipments when compared to the same quarter in 2013. Lenovo also turned in another solid quarter, solidifying its position in the top five.

Samsung still leads the way, despite collectively losing about 7 percent of market share. Galaxy S5 shipments remained strong, even as older flagships such as the S4 and S3 shipped in healthy numbers. IDC pinpoints that Samsung needs to focus on markets where local brands are ruling the roost to build further momentum.

Apple’s second quarter was as low-key as ever considering the much-anticipated iPhone 6 launch. IDC says strong sales in the BRIC markets was a good sign for Apple that it has established a presence in non-mature markets. The launch of the iPhone 6 will be crucial and could prove to be a “drought or a flood, depending on the timing of the next launch,” the firm said.

Huawei saw an increase of 2.4 percent over its Q2 2013 numbers, and this is largely due to increased 4G LTE adoption, particularly in China. Outside of China, Huawei found success with the lower-cost Y series of phones, and based on 2Q14 results, Huawei definitely has the momentum for a greater push in the year.

Lenovo had a record-breaking quarter in China despite local brands snapping at its heels. “While less than 5% of Lenovo’s shipments were registered outside of China in the second quarter of 2013, this share nearly tripled in 2Q14, with emerging markets, particularly BRIIC countries, picking up the largest volumes,” IDC said.

LG’s L series of mid-range and entry-level phones drove volumes, while the G3, which launched at the end of the quarter in Korea, is expected to drive up sales in the third quarter.

“As the death of the feature phone approaches more rapidly than before, it is the Chinese vendors that are ready to usher emerging market consumers into smartphones. The offer of smartphones at a much better value than the top global players but with a stronger build quality and larger scale than local competitors gives these vendors a precarious competitive advantage,” said Melissa Chau, Senior Research Manager with IDC’s Worldwide Quarterly Mobile Phone Tracker.