HTC is having an incredibly bad year. As the Inquisitr has previously reported, 2015 is proving to be the year that may spell doom for the once-huge smartphone pioneer.
That in mind, HTC posted their second-quarter financial results on Thursday and they’re even worse than predicted, with HTC anticipating a third-quarter loss five times what analysts had previously speculated, as reported by Business Insider. Analysts had predicted that shares could drop by about NT$1.17 (new Taiwan dollar) per share, but HTC suggested that they might be as high as NT$5.85 per share. Sales in second quarter also dropped lower than expected, a 48 percent drop to NT$33.0 billion — about $100 million in USD — while operating losses came in at about $160 million USD, according to MobileSyrup.
Unfortunately for HTC, they underestimated the effect that their own news could have on their stock. Analysts at Nomura advised their clients to sell shares in HTC, and the stock fell 10 percent in one day, hitting the Taiwanese stock market’s daily trading limit and halting the stock; there have been no trades since the stock closed at NT$63, down from over NT$70, the lowest level in 10 years. Graphs show a direct plunge from the moment HTC’s Q2 results were announced.
HTC is trapped right now between big names Apple and Samsung on one side, and Chinese value brands Huawei and Xiaomi on the other, and sadly, it remains a problem of their own making. HTC has always made some of the best smartphones in the world, and they still do, but their failure to keep up even slightly with Samsung and Apple’s marketing is rapidly driving them to ruin. HTC’s 2014 marketing budget was only 20 percent of Samsung’s, and the fallout is clear: marketing matters in the American smartphone market.
So what’s next for HTC? As the Inquisitr has previously reported, HTC has been pinning their hopes lately on their new virtual reality headset, the HTC Vive, being made in partnership with Valve Corporation’s Steam VR, but in light of the recent unflattering VR cover from Time, that plan may have had a bit of a snag. HTC has also been shaking up their leadership in attempts to turn the company around (a familiar phrase to anyone who follows HTC,) replacing long-time CEO Peter Chou in March with co-founder and chairwoman Cher Wang, and moving Chou to a product development role. Also this March, the company lost design chief Jonah Becker, who was hired in April of 2014 when they lost their last design chief, Scott Croyle.
HTC will be focusing on cost-cutting, looking to devices other than smartphones, looking for other corporate partners (as we’ve previously reported there have been rumors of companies like ASUS proposing to buy HTC outright) and more, but right now, things are looking pretty grim for HTC.
[Image courtesy HTC]