Apple becomes biggest smartphone player for the first time in two years, beating Samsung - CNBC

A woman tries out a new Apple 11 Pro during an Apple product launch event at Apple's headquarters in Cupertino, California on September 10, 2019.

Josh Edelson | AFP | Getty Images

Apple has beaten Samsung on quarterly smartphone shipments for the first time in two years, according to figures from several industry analysts.

The iPhone maker saw shipments surge to 72.9 million units in the fourth quarter of 2019, according to Counterpoint Research, climbing above the 70 million Galaxy phones sold by Samsung.

Strategy Analytics said Apple held the most market share in the quarter, with 70.7 million units sold versus Samsung's 68.8 million in the final three months of 2019. Another industry tracker, Canalys, reached a similar conclusion.

One firm, IHS Markit, bucked the trend, putting Samsung at 70.7 million and Apple at 67.7 million. But the figures nonetheless showed strong momentum for the U.S. firm as consumers flock to buy its latest model, the iPhone 11.

"Apple has surpassed Samsung thanks to iPhone 11 popularity and improvement in upgrade cycle from the larger base of iPhone 6S, 7 and user base," Neil Shah, partner and vice president of research at Counterpoint, told CNBC by email.

Still, China's Huawei managed to outpace its U.S. rival during the whole of 2019, taking the number two spot behind Samsung despite headwinds related to the U.S.-China trade war. The company accounts for a whopping 39% of the Chinese market, according to Canalys, with Apple trailing behind on 11.8%.

Apple reported better-than-expected earnings for the fiscal first quarter, thanks in no small part to a pop in iPhone sales. The tech giant said iPhone revenues climbed to $55.96 billion in the quarter, up 8% from the previous year.

Gartner Research Vice President Annette Zimmermann said the numbers showed Apple's strategy for the iPhone 11 paid off, noting the "clever marketing" strategy of dropping letters — referring to the iPhone X — in favor of a number, as well as a reduction in cost from previous models.

But risks remain for Apple and other smartphone players, especially as the spread of China's coronavirus threatens to shut down production operations for several manufacturers. In Apple's latest earning call, CEO Tim Cook said the firm had restricted employee travel and shut one store due to the outbreak.

"There will definitely be an impact on China in terms of consumption," Zimmermann said. She added that local sources are saying smartphone output will likely remain "on hold for another week or so" as the country grapples with the health crisis.

Despite a 1% slump in the overall smartphone market — the second decline in two consecutive years — experts expect the rollout of more 5G-capable devices to turn around the market's fortunes in 2020. Apple is slated to release its first 5G phone later this year, while Huawei, Samsung and Xiaomi have all launched 5G handsets already.

Such devices struggled to catch on last year, representing just 1% of sales, according to Counterpoint, but the firm expects this figure to rise to around 18% of shipment volumes in 2020.

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2020-01-30 11:55:00Z
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