DailyTech - HTC's Disappointing Fourth-Quarter Earnings are Lowest Since 2004

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Gadgets HTC's Disappointing Fourth-Quarter Earnings are Lowest Since 2004
Tiffany Kaiser - January 7, 2013 11:57 AM

5 comment(s) - last by Samus.. on Jan 7 at 1:11 PM

(Source: winrumors.com)

Analysts say the low numbers stem from HTC's lack of device offerings throughout the quarter

HTC's fourth-quarter earnings were less than stellar as it failed to offer enough new models to compete with the likes of the iPhone 5.

For Q4 2012, HTC reported an operating income of NT$600 million ($21 million USD), but analysts predicted NT$1.11 billion. Also, its net income was NT$1 billion, which is the lowest since 2004.

HTC's revenue also dropped 41 percent to NT$60 billion, which wasn't too far off from analyst estimates of NT$60.5 billion.

Analysts say HTC's disappointing numbers stem from the company's lack of device offerings throughout the quarter. The low number of devices it did offer were not very strong. However, HTC did introduce the Butterfly J smartphone, which should gain popularity in Q1 2013.

Last week, HTC CEO Peter Chou told investors that the worst is "probably" over now that a new year has started. In Q3 2012, HTC's sales plummeted 79 percent on a year-to-year basis, and global market share slipped from 2.7 percent in 2011 to 2.2 percent in 2012.

While 2012 wasn't looking too good for 2012, Chou insists that HTC will make worthwhile devices that will attract customers this year.

"One thing I'd learned from last year is to act fast and be responsive to market changes," said Chou. "We are being more flexible now. We are constantly fine-tuning our sales plans and position in various markets."

He added that "competitors were too strong and very resourceful, pouring in lots of money into marketing" and that HTC hasn't "done enough on the marketing front."

"Although we don't have as much money to counter [Samsung and Apple], the most important thing is to have unique products that appeal to consumers," said Chou.

HTC recently settled its patent issues with Apple, which locked HTC into long-term patent licensing agreements with both Apple and Microsoft. This should give HTC a boost as it is the most secure of the Android phonemakers as far as patent lawsuits go.

Source: Bloomberg