HTC Corporation posts losses of $60 mn as sales hit 5-year low
Taipei: Taiwan`s struggling smartphone maker HTC posted a net loss of Taiwan dollar 1.88 billion (USD 62.3 million) in the first quarter, a figure far worse than the Taiwan dollar 1.59 billion analysts forecast.
Sales in the three months to March fell to a five-year low of Taiwan dollar 33.1 billion.
HTC confirmed its unaudited first quarter loss was Taiwan dollar 1.88 billion, compared with a net profit of Taiwan dollar 85 million a year earlier.
Looking ahead, the company expected revenues to pick up from the second quarter due to the launch of the latest version of its flagship HTC One (M8) device and the mid-tier Desirer 816 targeting the Chinese mainland market.
"As the company expects robust demand for HTC One (M8) and Desire 816 from the second quarter, the sales would rise...and the company expects to turn profitable in the second quarter," it said in a statement.
But analysts cautioned against optimism, saying it would be a long way for HTC to regain ground in the market dominated by rivals Samsung and Apple as well as low-cost Chinese rivals like Lenovo and Huawei.
J.P. Morgan analyst Alvin Kwock said that it would be difficult for HTC to rebound because it cannot match the marketing budget of firms such as Samsung.
The South Korean tech giant spent USD 11.6 billion in marketing expenses alone in 2013, compared with around USD 877 million spent by HTC on "selling and marketing" last year.
Barclays analyst Dale Gai put HTC`s global smartphone market share at an estimated 2 percent.
The Taiwanese firm held a 4.6 percent share of the global smartphone market in 2012, sharply down from 8.8 percent a year earlier.
Samsung held a 30.3 percent stake while Apple had 19.1 percent, according to research firm IDC.