UPDATED 12:15 EDT / OCTOBER 08 2012

NEWS

HTC ‘Ya Later – What Chance a Comeback Now?

2012 has proven to be a nightmare year for HTC, and now things have just got a whole lot worse with Taiwanese smartphone maker’s third quarter profits slumping by a record-breaking 79%, well below its previous forecasts and the expectations of analysts.

HTC, ranked fifth biggest smartphone maker overall, reported its third quarter revenues had fallen to just $2.39 billion, 20% less its second quarter total of $3.04 billion, and almost a third less than its 2011 third quarter revenues of $4.5 billion. This comes following a previous statement by the company last August, in which it said that it expected revenues to drop only slightly, to $2.9 billion.

These latest losses only serve to underscore what a terrible year 2012 has been for HTC, who had previously enjoyed record breaking third quarter profits just 12 months ago. Sadly for the Taiwanese firm, since then it has struggled to keep pace with industry leaders Apple and Samsung, whilst even the likes of LG are reported to be gaining ground, causing speculation to mount over HTC’s very survival.

Bleak Prospects?

The future is looking pretty grim for HTC at the moment. Thanks to a combination of its poor marketing strategy and well publicized problems with its hardware, HTC has all but fallen off the radar in the US and Europe, whilst the company took the decision to pull out of Brazil altogether so that it could redouble its efforts elsewhere.

But this renewed focus on core markets may not be enough, with analysts pointing out that HTC is expected to be given a run for its money even on its home patch China, where it’s facing increasing competition from the likes of ZTE and Huawei.

The prospects for a recovery do not look great, although HTC does have high hopes for its two Windows 8 phones – the 8X and 8S. However, they’ll be in for a fight in this arena too, going head to head with a beleaguered Nokia that also sees the Windows 8 platform as its savior, not to mention arch-foes Samsung.

HTC still has some fight in it, but it remains unclear how or when it might be able to turn its fortunes around. One possible escape route for the firm might be the up-and-coming Mozilla Firefox OS, which is set to make its debut next year, although any move in this direction would be a huge gamble for a company that can have little margin left for error given its current economics. A last throw of the dice perhaps?


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