Samsung, Apple and Nokia named the top three vendors.
During 2012, 1.6 billion handsets were shipped, with 700 million from that figure attributed to smartphones.
The figure represents a 2 percent increase when compared to 2011. The market's slow growth was blamed on stricter upgrade policies, changing consumer tastes and economic challenges stemming from North America and Western Europe.
Global smartphone shipments increased by 490.5 million units when compared to 2011, but the subsequent 43 percent growth rate is eclipsed in comparison to 2011's growth rate of 64 percent over 2010. Saturation in North America and Western Europe was cited as the reason for the slower growth.
According to Strategy Analytics, Samsung shipped the most handsets throughout the year with a 30 percent share, with Nokia and Apple following. As for smartphones, Samsung shipped the most units, while Apple followed in second, with Nokia trailing behind at third place. Chinese handset manufacturer ZTE settled for fourth place.
Apple accounted for 19 percent of the market with 135.8 million iPhone units shipped during 2012 (47.8 million in Q4), representing an increase of 46 percent. It benefited from strong demand in North America but failed to establish a presence within several developing markets such as Africa. Nokia, meanwhile, saw its market share drop from 16 percent to 5 percent.
"Fuelled by robust demand for its popular Galaxy models, Samsung was the star performer, shipping a record 396.5 million mobile phones worldwide and capturing 25 percent marketshare to solidify its first-place lead. However, Samsung’s total volumes for the year fell just short of the 400-million threshold," said Strategy Analytics
"Large marketing budgets, extensive distribution channels, and attractive product portfolios have enabled Samsung and Apple to tighten their grip on the smartphone industry," the market researcher added.