HTC Corp., which is the largest smartphone maker, based in Taiwan, announced that its net income missed analyst estimates for a fourth consecutive quarter, as reported by Bloomberg earlier today. The decline in the companys sales was also a result from the rising Chinese brands competition. Bloomberg has also calculated that the data about the companys fourth-quarter earnings means HTC posted its first annual loss in 2013, after reporting its first quarterly loss of 2.97 billion New Taiwan dollars until September the 30th.
HTC posted a fourth-quarter net income estimated to 310 million New Taiwan dollars (10 million dollars), which is too far from the forecasts of the 20 Bloomberg analysts. The average operating loss, which was estimated to 1.72 billion New Taiwan dollars was narrowed to 1.56 billion New Taiwan dollars. The share of the company got their lowest estimate since October.
The company hoped to stop its nine-quarter slide in sales by releasing its One Max phone, but its plans failed. Signing a contract with the Hollywood star Robert Downey Jr. to promote the HTC brand also did not work well enough in order to fight the competition of Lenovo Group Ltd. And Huawei Technologies Co. Here is what one of the analysts working for Yuanta Financial holding Co. said on the occasion: “They need to get a good review for their flagship model and they cant afford to have any supply chain problems like last year. They have to perform on both the high-end and the low-end.”
The quarters revenue of HTC fell 29% to 42.9 billion New Taiwan dollars. As a matter of fact, the company has managed to meet analysts expectations about its net income only once during the last two years, and its sales have felt behind the estimates for almost three years now, as Bloomberg reported earlier today. The company managed to avoid its second loss on record thanks to the sale of the HTC 24.84% stake in Beats Electronics LLC.
Kylie Huang, who is an analyst working for Daiwa Securities Group Inc. said: “The weakness in top-line was due to the lackluster demand of its new flagship model HTC One Max and the mid-range Desire-series models.” She also said: “We view 2014 could be a worse year for HTC as the benefit from the cooperation with China Mobile and its recent changes, if any, could be offset by the fiercer competition from leading OEMs and China brands.”
According to Bloomberg, the current share price of HTC Corp. is 3.61% down, and the one-year return rate is 52.95% down.
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