Samsung's Smartphone Shipments Are Back on Top, But Apple Shouldn't Worry

Source: Apple.

Apple just reported its quarterly earnings last week, and most of the news was great. Despite a drop in iPad sales (for the fifth quarter in a row), revenue was up 27% year over year and the company saw another strong quarter of iPhone sales. Apple sold 61.2 million phones, up an amazing 40% year over year, though it was abit of a drop from the previous quarter's record-breaking 74.5 million iPhone sales.

Meanwhile,Samsung was able to outpace Apple's Q1 smartphone shipments and take back the title of top smartphone vendor from Apple. And the South Korea-based company did this without including shipment numbers from itsnew high-end Galaxy S6 and S6 Edge devices.

Here are the first-quarter smartphone shipment numbers by vendor, according to Strategy Analytics:

Source: Strategy Analytics.

Samsung captured about 24% market share in the first quarter, dropping from 31% a year earlier. Meanwhile, Apple grabbed 18% market share, up from 15% a year earlier.

After three consecutive quarters of Samsung losing market share, the company was finally able to slow the losses in Q1, though most of the improvement was in the mid- and low-end smartphone market. That's bad news for Samsung, because the company doesn't make as much profit from those devices.

Samsung has been losing out to Apple in the high-end smartphone space, and is trying to turn that around with the new S6 lineup. Samsung says its new flagship devices are on pace to outsell last year's S5 model, as well as its previously popular S3 and S4 models."Galaxy S6 sales have been going as well as expected, while demand for the Galaxy S6 edge has been better than anticipated," Samsung's vice president, Park Jin-Young, said on the company's most recent call.

But despite Samsung reclaiming the top smartphone vendor title and launching its new top-of-the-line devices, Apple has little to be concerned about.

Source: Apple.

Apple's advantageSamsung is facing a major uphill battle in mobile right now.

In Q1, Samsung's mobile division operating profit fell 57% year over year, and the company continues to lose ground in smartphone profit.

Samsung's devices accounted for 95% of all Android device profit in 2013, but that's fallen to just over 50% at the end of 2014.

Meanwhile, Apple continues to dominate. Apple collects the vast majority of all smartphone operating profit (88.7%) and its worldwide position is only getting better.

Apple's worldwide smartphone market share increased from 11.9% in Q1 2014 to 17.7% in Q1 2015, and its iPhone 6 and 6 Plus are expected to continue driving that growth. China has surpassed the U.S. as Apple's largest iPhone market, thanks to a 72% increase in sales in the country this past quarter. And Apple's revenue in the Greater China region (which includes China, Hong Kong, and Taiwan) was up 71% in fiscal Q2 2015.

Even with increased competition from Samsung's new Galaxy S6 and S6 Edge, Apple's current lead in the high-end market and its growing strength in worldwide market share means Samsung has a lot of ground to make up before Apple has anything to be concerned about.

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