New products to return Taiwan’s HTC to growth by year end

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Taiwan's HTCTAIPEI -Taiwan’s HTC Corp will return to growth in final three months of 2014 after a bruising few years has seen market share dwindle amid steep sales declines.

October-to-December period will see company’s first rise in year-on-year revenue in 12 quarters, company chief financial Chialin Chang said after firm’s quarterly investor conference.

“The growth will come from a kick in momentum for our flagship phone as well as new product introductions,” Chang said.

Those products likely will include HTC’s first-ever phone based on the Windows operating from Microsoft Corp, a partnership Chang said was “going well.”

HTC is also working on a smartwatch with Silicon Valley internet giant Inc, but Chang wouldn’t say when the product would hit the market.

But it will take more than a few new gadgets to convince company watchers the firm has turned a corner.

Sales at the beleaguered phone company, which once sold of every 10 smartphones worldwide, have only notched two months of year-on-year growth of the past 32.

third-quarter revenue is also likely to decline slightly compared with the same period of 2013.

The firm will look for efficiencies in its sales and marketing operations in order to maintain profitability, Chang said, adding it would not reduce headcount.

These cost-saving measures have already started to take effect, as HTC previously reported higher-than-expected second-quarter net of T$2.26 billion.

The firm is also expecting to eke a slight net in the third quarter, Chang predicted.

Chang noted that the firm is willing to sacrifice margins in order to drive volume, though he emphasized that HTC would not sell its products at a loss in exchange for market share.[eap_ad_2]

HTC’s share of the global smartphone market was a slim 1.4 percent in the first quarter of 2014, according to research firm Gartner.

As Apple Inc likely prepares to launch a new large-screen iPhone model, industry watchers remain skeptical that HTC can return to a steady growth model.

“Given the shortened cycle of smartphones and the introduction of Apple’s new iPhones, we believe HTC’s recovery in the second quarter is temporary,” SinoPac Securities analyst Calvin Huang wrote in a research note issued ahead of the quarterly conference.


Many blame HTC’s lack of a compelling message and failure to stand from competitors like Samsung Electronics Co Ltd and China’s Xiaomi Inc an increasingly important factor as smartphones, especially -priced, -margin models, no longer sell in the huge volumes of the past.

Growth in the worldwide smartphone market will slow to 23 percent this year from 39 percent in 2013, according to researcher IDC. This will be accompanied by a drop in average selling from $335 in 2013 to $314 in 2014, IDC said. (Reuters)[eap_ad_3]