|HTC's Q3 2013 Loss ... |
>> HTC posts first-ever quarterly losses as troubles multiply
Michael Gold and Faith Hung
October 4, 2013
Taiwan's HTC Corp slid into the red for the first time in the third quarter, with sales hit hard by fierce competition in the smartphone market, supply chain constraints and internal turmoil.
Underscoring a dramatic decline for a company which boasts award-winning smartphones but has failed to develop a durable brand of handsets, it posted an operating loss of T$3.5 billion as sales for the quarter tumbled by a third from the same period a year earlier.
At a net level, it booked a loss of T$2.97 billion ($100 million), bigger than an expected loss of T$1.8 billion, according to Thomson Reuters SmartEstimates. That compares with a net profit of T$3.9 billion in the same quarter last year.
Its shares were down 2.3 percent in early trade.
HTC lacks the scale of bigger rivals Apple Inc and Samsung Electronics Co Ltd and its troubles this year have only multiplied.
In addition to internal feuding and executive exits, sources have said that it is facing casing shortages for its HTC One Mini. It has also lost some patent cases and media have reported that three of its design executives have been arrested on suspicion of leaking trade secrets.
HTC's share of the global smartphone market has plummeted from a peak of 9.1 percent in 2011 to 2.6 percent in the most recent quarter, according to research firm Gartner and analysts have said it needs a wholesale reevaluation of its strategy in order to survive. ###
>> HTC Posts Wider-Than-Estimated Quarterly Loss as Sales Slump
Lulu Yilun Chen (Hong Kong) & Adela Lin (Taipei)
October 3, 2013
HTC Corp. (2498), Taiwan’s biggest smartphone maker, posted a third-quarter loss wider than analyst estimates as its handsets lost market share to devices from Apple Inc. (AAPL) and Samsung Electronics Co.
The company had a net loss of NT$2.97 billion ($101 million) in the three months ended September, Taoyuan City, Taiwan-based HTC said in an e-mailed statement today. That compares with the NT$1.71 billion average loss of 16 analyst estimates and is the first on a consolidated basis since at least 2008, according to data compiled by Bloomberg.
HTC’s flagship One has failed to arrest sliding sales amid product delays and changes to strategy as it faces intensifying competition from Chinese producers including Huawei Technologies Co. The company, which wasn’t among the top five producers in the second quarter, plans to boost promotion with actor Robert Downey Jr. and add cheaper devices to revive growth.
“HTC needs to figure out if it just wants to focus on the high-end market or the mid- to low-end segment, and right now it is missing out on both,” said Wang Wanli, a Taipei-based analyst at CIMB Securities Ltd. “In the fourth quarter many new products are in the pipeline, including iPhone, Samsung and Huawei, HTC only has one new model so they won’t see a strong pick up.”
Shares of HTC fell 0.8 percent to NT$132 as of 9:51 a.m. in Taipei. The stock has lost more than 80 percent of its value in the past two years.
The operating loss in the third quarter was NT$3.5 billion and sales were NT$47 billion, the company said today. Analysts had projected an operating loss of NT$2.2 billion on sales of NT$ 54 billion.
HTC, the first maker of phones using Google Inc. software, in July forecast an eighth straight drop in quarterly sales as it struggles to compete with Apple and Samsung.
The company was ranked ninth in the global smartphone market during the second quarter, with 2.8 percent share compared with 5.8 percent a year earlier, according to data from Bloomberg Industries and IDC. That compares with 31.7 percent for Samsung, 13.2 percent for Apple and 4.8 percent for Lenovo Group Ltd. (992)
HTC was a contract manufacturer before it began promoting its own brand in 2006. The company had a short-lived reign at the top of the U.S. market in the third quarter of 2011, when it accounted for 24 percent of smartphone shipments, according to researcher Canalys.
The company in February 2012 said it had “dropped the ball” on products, pointing to weaknesses in design and engineering. The HTC One, which was supposed to herald a reversal of fortune, has so far failed to stop a slide in the company’s sales since the phone’s introduction was delayed to the same timeframe as Samsung’s flagship Galaxy S4.
HTC lost the early momentum of unveiling its HTC One in February prior to Samsung’s Galaxy S4 as a shortage of camera components forced it to delay shipments. ###
- Eric -