HTC Profit Plunges, Sales of "One" Slow as Sector Stagnates
July 5, 2013 6:52 PM
comment(s) - last by
HTC may now be moving a million units of its flagship smartphone or less, slips to tenth place
top smartphone seller in the U.S.
, Taiwan's HTC Corp. (
) has today slipped to tenth place, according to Gartner, Inc. (
). The company this week announced its earnings for June, revealing that it will miss analyst earning expectations despite modest sales of its
. The struggles are the latest for the company, which has seen a
dramatic financial fall from grace
since late 2012.
I. The Fall to Tenth Place
The embarassing plunge could be blamed on a variety of causes:
The general competiveness of the smarpthone market
HTC's failure to gain ground in emerging markets like China
U.S. slippage (
due to import bans
and being outmarketed by top U.S. sellers Apple, Inc. (
) and Samsung Electronics Comp., Ltd. (
to Apple and Microsoft Corp. (
HTC gave no hard numbers on how many One smartphones it has sold, only stating that sales are picking up. Previously, an unnamed executive had told
The Wall Street Journal
that by late May
5m One smartphones had been sold
. That was roughly 2 months after the global launch, and 1 month after the U.S. launch (which was
delayed to late April
But Citigroup Inc. (
) Global Markets Inc analyst Kevin Chang estimates there may only have been ~1.2m in May sales and ~600,000 in April sales. He
The Taipei Times
, "HTC shipments to peak in May, stay at a similar level in June and start to decline in July."
HTC One sales appear to have seriously slid in June, after a May surge.
And reality may be even worse than that when it comes to June sales. HTC pocketed $29B TWD ($962M USD) in May, but just $22.1B TWD ($733M USD) in June. June's sales had erased roughly 70 percent of May's gains over April, at about twice
February's record low
($11B TWD ($365M USD)).
In total HTC took in $70.7B TWD ($2.35B USD) for the quarter versus a
of $72.8T TWD ($2.42B USD). Net revenue (profit) was $1.25B TWD ($41.5M USD), well short of the $2.17B TWD ($72.0M USD)
-surveyed analysts predicted.
HTC has closed several offices as part of a downsizing plan. [Image Source: Reuters]
The losses come despite
aggressive cost cutting
by HTC and
facility closures late last year
II. No Relief in Sight?
The future is murky for HTC.
aggressive changes on the marketing
Robert Downey Jr. (of
fame) to a $12M USD endorsement deal, making him the face of HTC's high-tech smartphones.
Robert Downey Jr. will reportedly give HTC marketing a boost. [Image Source: Marvel Studios]
Those high-end products include such well reviewed premium products as the
overseas "Butterfly" model
and the international "One" flagship device, both of which feature attractive margins.
But overall HTC's lineup looks anemic and its recovery seems to be slowing. There's a serious risk that HTC's long time
CEO Peter Chou may step down
last year's mid-range devices
is a troubling sign for HTC, and may be enough to scare off customers to HTC network-carried handsets.
Those things aside, perhaps the biggest looming threat is the lack of upcoming products in the pipeline, at least according to currently leaked information. HTC is planning on launching
an HTC One Mini
in August that looks like a substantial step up from the
Galaxy S 4 Mini
. But the Galaxy S 4 Mini is out
-- and Samsung's rumored to upgrade it around the time of the HTC One Mini launch.
The HTC Mini is arrive late to the party, so to speak. [Image Source: forte.delfi.ee]
Samsung is releasing specialist smartphones (like the
), while HTC's lineup remains small. And while Apple's big update -- the
Apple iPhone 5S
a faster Galaxy S IV
are rumored to be on the horizon for fall launches, there's a relative lack of compelling upcoming product from HTC in the rumor mill thus far. That's not to mention Huawei Technologies Comp.'s (
upcoming Ascend P6
and Nokia Oyj.'s (
Sure, the HTC One impressed, but did HTC tip its hand too early and fail to follow up? That's what increasingly looks to be the case, as the next generation of smartphones to be released over the next few months aim to erase the reviews lead HTC's flagship device briefly enjoyed.
HTC can take comfort in the struggles
. But at the end of the day the parts of the roadmap that are leaked or public known seem to suggest HTC to be at a competitive disadvantage looking at the rest of 2013.
This article is over a month old, voting and posting comments is disabled
RE: It's a shame
7/8/2013 10:21:52 AM
On T-Mobile, One S was not a midrange phone. While S3 came a couple of months later, One S was the most expensive Android phone save the Note in the line up.
While it had qHD AMOLED 4.3" vs. HD SLCD2 4.7" on the screen, smaller battery (due to smaller screen) and front cam was below specs, it had a better build quality (ceramic vs. polycarbonate).
And the SOC it used MSM8260A is CPU+GFX wise the same as its OneX cousin MSM8960. The difference is that the latter has support for LTE while the former ends with DC HSPA+. It was released at a time TMo still had not disclosed plans to move to LTE.
So hardware spec-wise while it was not the highest, it was closer to high-end than mid end when compared to contemporaries.
HTC One S was available (late Apr 2012) with 4.0.3 ICS(when 4.0.4 ICS has been available for more than 2 months). Within a couple of months JB(4.1) was released. So HTC always updates to 1 version of the OS from the release version esspecially when the release version is actually not the latest.
When HTC was "golden"(till 2011), it basically had a great attitude of support. It had removable batteries, expandable memory and good OS support and upgrade policy irrespective of the class of phones. This was at the time that Samsung literally had disastrous start with the Galaxy series of Android phones. When HTC went to chasing just new customers and said screw you to existing customers, they started going down.
I have had travails with the HTC Amaze 4G upgrade
Look at the TMo forums on the problems that happens whenever HTC upgrades the OS. Very poor QC and testing.
RE: It's a shame
7/8/2013 4:44:20 PM
I hear what you are saying, but just because it was the highest Android phone except for the note on one budget carrier doesn't make it high end phone. It was a mid-range phone period. The same generations "high end" from HTC was the OneX. Whether T-mobile had that or not at any given time doesnt change the fact that the One S was their mid-range phone... And they did update it to JB.
If you do want the latest erison of the OS, here ya go.
As a person that comes to Anandtech/Dailytech I assume you arent "normal" and are somewhat technically inclined, so it should be an easy path for you.
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