Taiwan smartphone maker HTC Corp. reported its third consecutive drop in
quarterly profit as intensifying competition from Apple Inc. and
Samsung Electronics Co. hurt sales.
HTC said Friday that profit
dropped 58 percent to 7.4 billion New Taiwan dollars ($248 million) from
revenue of NT$91 billion in the three months through June. It reported a
70 percent drop in the first quarter and a 26 percent drop in the final
quarter last year.
HTC has grown on the strength of the design of
its handsets, based on Google's Android operating system. But its sales
have fallen sharply in a global market increasingly dominated by Apple
Inc. and Samsung Electronics Co.
The company predicted third quarter revenue of NT$70-80 billion, down 41-48 percent from the same period last year.
HTC
had hoped to win back some of its market with the launch of "HTC One"
series, which offers users a better camera and music experience. But
following the huge popularity of Samsung's Galaxy handsets, the model's
key U.S. carrier, AT&T, recently slashed the prices of "HTC One" by
half, which may hurt HTC revenue.
As a young business which only
began building its own global brand in 2006, HTC chief financial officer
Chang Chia-lin recognized that the company "needed to work harder" to
lure consumers to its handsets in a volatile and competitive market.
Chang
said the U.S. will continue to be an important market, but the emerging
China market "will be a key driving force for our future growth."
He
declined to comment on whether the Chinese market's preference for
low-end, low-priced handsets would drive down the company's overall
revenue.
Last month, HTC announced it was selling half of the 50
percent stake it had bought in U.S. headphone maker, Dr. Dre's Beats
Electronics, raising concerns about the soundness of the company's
acquisition strategy.
Chang said the equity sale is to "create a
win-win situation" to give Beats' managers more flexibility to boost
their product value. But he indicated the need for more caution in
investment.
"We will continue to invest in the future," Chang
said. "But we will allocate resources to focus on key growth areas, such
as production innovation, sales and marketing."
source: NDTV
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