Global smartphone shipments crossed the 300 million threshold for the first time during the third quarter, with challengers eating into the share of market leaders Samsung and Apple, Canalys estimates.
Shipments grew 23% year-on-year over the quarter, the research firm said. Samsung and Apple's combined share of the market slipped from 48% to 38%.
Chinese vendors including Xiaomi and Huawei are leading the charge, with six of the top 10 global vendors coming from the market.
The strong value proposition and increasing quality of handsets from competing vendors is likely to continue this trend.
Samsung's share fell from 34% in Q3 2013 to 25% at the end of last quarter. But the launch of the iPhone 6 and iPhone 6 Plus helped Apple improve its share to 13%. Xiaomi was in third place with a 6% share, followed by Lenovo and Huawei at 5% apiece.
“It has been yet another stellar quarter for Xiaomi, which has extended its lead in China since last quarter, become the global number three vendor, and, encouragingly, achieved volume growth, albeit modest, in markets beyond mainland China,” Canalys principal analyst Chris Jones said.
Xiaomi's recent acquisition of Motorola Mobility gives it an even stronger share of 8%, and puts it in the position to be a real challenger to Apple, he said.
“The global market is becoming more competitive, with vendors beyond Samsung and Apple enjoying growing success.”
Canalys said emerging Indian vendors including Micromax, Lava and Karbonn are similarly challenging the incumbents in their domestic market. These three companies are all among the top five handset vendors in India.