The global smartphone market has returned to growth with overall shipments increasing by 3% year-on-year in the third quarter of 2025, according to new research from analyst firm Omdia. This rebound marks a significant positive shift for the industry, driven by strong replacement demand and major product launches that have revitalized consumer interest in upgrading their devices.
Apple’s Record-Breaking Performance
Apple Inc. achieved its strongest third quarter in company history, with shipments growing by 4% year-on-year to secure an impressive 18% market share. This exceptional performance was largely driven by robust early demand for the new iPhone 17 series, particularly the base model which exceeded expectations with upgraded storage at unchanged prices. The redesigned Pro and Pro Max models continue to attract consumers globally, according to recent analysis of market trends.
Samsung Maintains Market Leadership
While Apple captured strong growth momentum, Samsung maintained its position as market leader for the third consecutive quarter, holding a 19% market share. The company’s sustained strength was attributed to steady volume from its budget-friendly Galaxy A series and the successful launch of its upgraded 7th-generation foldable devices. Industry experts note that Samsung’s diverse product portfolio continues to resonate across different consumer segments.
Global Vendor Performance and Market Dynamics
The rest of the top five global vendors demonstrated remarkable stability in the recovering market:
- Xiaomi maintained a solid 14% market share
- TRANSSION grew by double digits to achieve its highest ever Q3 volume
- vivo captured 9% market share alongside TRANSSION
TRANSSION’s standout performance benefited from recovering demand in Middle Eastern and African markets, while all major vendors focused on balancing hardware and software appeal to capture upgrade opportunities.
Drivers Behind the Market Recovery
The market recovery is being primarily driven by consumers looking to upgrade or replace older smartphone devices. Research Manager Le Xuan Chiew noted that vendors have strategically balanced hardware innovations with software enhancements, with foldables, slim designs, and bold colors capturing consumer attention. This strategic approach comes as the industry faces challenges, including increasing cybersecurity concerns that highlight the importance of secure device ecosystems.
Challenges and Future Outlook
Despite the positive growth, the outlook remains cautiously optimistic due to intense competitive pressure and rising bill-of-materials costs. Senior Analyst Runar Bjørhovde emphasized that success moving forward will depend on vendors differentiating themselves and capturing wider opportunities through subscription services, accessories, and ecosystem upsells. These challenges are compounded by technological shifts across the industry, including compatibility issues with older devices and the hyper-growth of AI and data centers competing for semiconductor capacity.
Strategic Implications for the Industry
The current market dynamics suggest that vendors must focus on sustainable operational models that extend beyond hardware sales. As streaming service rebranding initiatives demonstrate, ecosystem development and service integration are becoming increasingly crucial for long-term success. Data from market share analysis indicates that companies successfully leveraging their brand ecosystems are better positioned to maintain profitability despite rising component costs and competitive pressures.
The iPhone maker’s record performance, combined with Samsung’s consistent leadership and the strong showing from Chinese manufacturers, paints a picture of a maturing market where differentiation through both hardware innovation and ecosystem development will determine future winners. As the industry continues to evolve, understanding these smartphone market dynamics becomes increasingly important for both consumers and industry stakeholders navigating this competitive landscape.
