Two of the leading Chinese mobile phone distributors, isidi and TELLING, saw sharp declines in their profits during 2014, according to their pre-announcements of annual earnings. TELLING expects to report a net loss of RMB323-357 million (US$52-58 million) despite turning a profit the previous year. isidi estimates its profit for 2014 was down by 97-99%.

TELLING attributed the decline to four main causes:

The first two reflect the fact that the structure of China’s mobile phone market has changed dramatically in recent years. The four-year-old mobile device maker Xiaomi surpassed Samsung to become #1 in terms of smartphone unit shipments in the Chinese market in the fourth quarter of 2014, according to a report by Strategy Analytics.

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Tracey Xiang

Tracey Xiang is Beijing, China-based tech writer. Reach her at traceyxiang@gmail.com