Its new high-end smartphone, the Galaxy S6, has had strong advance sales. It has replaced Qualcomm as the maker of chips for the iPhone, made by its chief competitor, Apple. And a streamlined slate of product offerings could help it compete with the low-end devices dominating the market in China.
Evidence of a potential turnaround could also be found in the beleaguered South Korean manufacturer’s bottom line: Samsung said on Tuesday that it expected its earnings for the first quarter of 2015 to show that the decline in its operating profit was still steep but was beginning to level off.
A resurgent Samsung poses a direct challenge to China’s smartphone brands, which must find a way to compete outside of their home market with major multinationals. The early popularity of the S6 could make it difficult for Chinese companies to do that with high-end offerings, said Bryan Ma, an analyst at the research company IDC.
“You look at Huawei and ZTE” and other Chinese companies, Mr. Ma said. “Their ambition is to move out of the low end into the premium end, so they’re trying to move up that curve as well.”
Mr. Ma added that it would be difficult for Samsung to make money at the lower end. “It’s such a bloody price war down there,” he said.
Intense competition at the low and high ends of the smartphone market has eroded Samsung’s status as the world’s best-selling smartphone brand, according to IDC.
Some of Samsung’s biggest troubles have come from China, where it has struggled to compete in the low end with companies like Huawei and Xiaomi. The period of torrid growth in China’s market is moderating, but analysts expect new booms in other heavily populated developing markets, like India and Southeast Asia.
For Samsung, that sets up new fronts of competition where the company can take advantage of its brand recognition, marketing and experience selling across the globe to push back against Chinese rivals. For instance, in India in the fourth quarter of last year, Samsung had a 22 percent market share, compared with Xiaomi’s 4 percent, according to IDC.
The release of the S6 may help offset the stellar performance of the iPhone 6, while also putting more pressure on smaller rivals trying to make a name — and bigger profits — for themselves with flashy, expensive flagship devices.
Analysts say the S6, which boasts new features like a metal casing and a version with a screen that curves over the sides of the phone, provides much-needed stylistic freshness.
“I think the reason Samsung struggled last year is they just looked boring,” said Peter Yu, an analyst at BNP Paribas. He pointed out that the Galaxy model from 2014 was little different from the 2013 version.
“Everyone caught up,” he said. “When it came to Android phones, everything now just looks the same. If you cover up the brand, you couldn’t tell the difference between the Chinese smartphones and the Samsung smartphones.”