Original URL: http://www.theregister.co.uk/2013/05/03/htc_q1_2013/

HTC profits PLUNGE 98%: Pins hopes on HTC One, 'Facebook mobe'

CEO knows he doesn't have brand value nailed

By Paul Kunert

Posted in Financial News, 3rd May 2013 14:04 GMT

Beleaguered smartphone-maker HTC is hoping that a massive marketing drive and gathering sales momentum for its One device and the HTC First "Facebook phone" will help it recover from its disastrous Q1 outing.

Sales slumped nearly 37 per cent to NT$42.8bn (£930m) - and HTC made a measly NT$85m (£1.85m) profit on that - representing a 98 per cent dip. Shipments of HTC's new flagship intelli-mobe in the quarter had been beset with delays, said the firm.

In a conference call with analysts, Chialin Chang, CFO at the Taiwanese firm, admitted to "some delays in certain markets by a few weeks".

However the company refused to confirm the proportion of sales accounted for by the HTC One in the quarter.

Chief Peter Chou said availability has "greatly improved" and demand is strong: "We just need to work hard to try to supply as much as possible."

The next plan for HTC, which has lost ground to rivals Samsung and Apple, is to apply some veneer to its brand to help it stand out in a crowded space - bit late for that surely?

Chou said there are "a lot of suppliers coming out from everywhere and then no differentiation in the market".

The CEO added: "And of course, we also know that we have to greatly improve our go-to-market approach in terms of marketing, in terms of channel."

According to Gartner smartphone data for 2012, HTC sold a little over 32 million units compared to 43.26 million in 2011, reducing its market share to 1.8 per cent (10th spot). It had previously held 2.4 per cent of the market.

Looking at Q4 in isolation, HTC fell out of the top 10 handset-makers entirely.

The Taiwanese mobe-maker said it expects Q2 revenues to be in the region of NT$70bn (£1.52bn) with an operating margin in the region of one to three per cent. ®