UPDATED 11:33 EDT / FEBRUARY 06 2012

HTC Has High Hopes for MWC as Earnings Falter

Taiwanese handset manufacturer HTC reported its far-from-optimistic fiscal forecast for Q1, during which the steady decline in revenue and share price it has seen throughout last year will likely persist.

HTC expects to see something in the range of $2.20-2.37 billion in sales next quarter, below analysts’ average approximation of $3.04 billion. That’s the equivalent of T$65-T$70, considerably less than the T$101.42 billion it has reported for the last quarter. These figures come alongside January sales 52.6 percent weaker than last year’s T$16.62 billion, and nearly 40 percent less than the month before.

Net profit also took a hit, and declined 26 percent to $364 million.

The mobile giant, which can credit its early rise to power to Android, said that these are only short term difficulties, an estimate that at least a portion of HTC’s investors agree with.

“It can be turned around,” says Melissa Chau, Singapore-based research manager for IDC, speaking before the company gave its first quarter revenue guidance. “But the problem remains the same: How are they going to differentiate?”

HTC will be providing the answer for that at the upcoming 2012 Mobile World Congress, where it will be launching several new models in hopes of amending its current situation. Some of the homegrown innovations HTC’s new Android handsets will feature include quad-core chips, as well as one particularly thin model.

While the company is sliding down the hill, Android continues to grow its presence in the mobile space. HTC’s main challenge is too much competition. This quarter it lost its position as the largest Android OEM by sales to Samsung, which reported revenue of 47 trillion Korean won – which adds up to more than what HTC made in its own local currency.


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