After a great Q3 of 2011 where the Taiwanese company posted a $624 million profit, HTC is now reporting that year-over-year profits in the fourth quarter of 2011 dropped 26% to $364 million. This is the first drop in profit for HTC in the past two years and analysts are predicting that this decline will continue into the first quarter of 2012. The popularity of Apple’s iPhone, as well as the recent release of the Samsung’s Galaxy Nexus, are partially to blame for the revenue decline. Bloomberg notes that the weakened global economy is also a contributing factor to the diminishing of HTC’s profit.
With CES 2012 set to kick off in just a few days we anticipate HTC will be unveiling a few new devices that may help the company get back on the right track. Hopefully launching these new devices, as well as the release of it’s new Quattro Tegra 3 tablet later this year, will bring back the great profits HTC generated last year.
Do think there is reason for concern? Do you think launching a few new devices will help turn things around or should HTC focus on a change in strategy?
Source: Bloomberg
I think the key thing is the quality of 2012 products. The 2011 phones were great, but felt mainly like a feature enhancement of the ones that came before (e.g. upgrade Desire to Sensation). HTC Sense when it first came out was a significant step up, and HTC will need to “invent” something novel akin to that to stand out from the crowd. In the crowd it won’t do well at all, as Samsung, for example, can make more Apple-esque copied designs at lower prices and have more to spend on advertising, etc… (even though I’m not a fan of their thin plasticky phones).
I think HTC is doing just fine. If you look back at Q4 of 2010, you’ll see that they had a big quarter because of the launch of the HTC Desire HD and Desire Z. HTC has a few good phones in Q4 of this year, but they were mainly devices launched on specific U.S. carrier networks.
I agree with you Nick, HTC are brilliant if not in fact amazing but they need to create more phones with newer technologies to keep up with the likes of Samsung but also think about the rest of the World and not just the America’s. Most phones last year concentrated on that market. Europe is as good a market to bring these types of devices out to. I will always buy and promote HTC they are the best.