HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

Summary: HTC faces a tough 2012 ahead, as the company posts massive losses, and is facing a U.S. import ban on many of its devices. HTC has trouble brewing ahead.

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HTC's fairytale 2010 is over, as the company reported a 25 percent fall in fourth-quarter profits. The smartphone maker is struggling to compete with its Android rivals and the Apple iPhone.

The Taiwanese phone giant's net profits dropped by 26 percent to $364 million from $490 million in the three months ending in December, from the same period a year earlier.

The company's revenue fell by $3.35 billion, a 2.5 percent decline on the previous year. Meanwhile, sales for December fell by over 20 percent from a year ago to $870 million.

But credit where credit is due. HTC saw this coming and warned for a downbeat period. Samsung appears to be unstoppable -- except for Apple's legal intervention -- in the Android market, and the disparity between the company's sales figures shows that.

The company said earlier in October that it expected lower revenues in the upcoming fourth-quarter due to "uncertainties from new models". HTC predicted its fourth-quarter revenue would suffer, even though its third-quarter posting was strong.

In December, things got worse for the smartphone giant as the company posted a 30 percent drop in sales from October, around 20 percent lower on the same period in 2010.

HTC sits behind Samsung as the global smartphone leader, with Apple second and Nokia third. Samsung said it expects a record fourth-quarter, with operating profits up by over 70 percent due to increased smartphone sales.

As the company continues to bring consumers top-of-the-range smartphones, competition within Android circles is taking its toll on everyone bar Samsung, which remains the top of its game.

What probably doesn't help HTC in the coming months is the U.S. import embargo on its smartphones. We can expect the U.S. market share to slide away further from HTC, and its profits drop significantly -- perhaps to breaking point.

What happens next? Unless HTC can pinpoint exactly where it is going wrong and strategize as to where it can take its dwindling smartphone business, analysts' predictions for the first-quarter net profit will ring true.

If the first-quarter continues to fall year-on-year, post the Christmas holiday snap, we know HTC is in a real quagmire.

Image credit: Reuters.

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Topics: Enterprise Software, Hardware, HTC, Mobility, Samsung, Smartphones

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14 comments
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  • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

    Go all in with Android, the only thing to do.
    Sultansulan
  • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

    The graph on the right is total fantasy and wishful thinking on market share after 2011. Microsoft has to date proven capable only of ineptitude in the mobile OS arena.
    dheady@...
    • Right.

      @dheady@...
      Sure, dheady. Sure. ;)
      William Farrel
  • Consolidation

    At the moment, htc seems to bring out a different phone every week. They need to look at the range and just have one or two phones in each market (budget, mid and high end) and keep them constant for several months.

    I really don't understand the Samsung success. I have used both a Galaxy SII and a Sensation and the Samsung just feels cheap and tacky in the hand, whilst the Sensation is solid and comfortable to hold. The TouchWiz is also not very nice, but I suppose that is down to personal choice.

    Still, the Galaxy SII does feel better in the hand than the iPhone 4/4S - once of the reasons I didn't upgrade my 3GS to a 4.

    Quality is also a problem. I also have an htc Mozart, well, I've had 2, the first had a faulty processor / memory. But they also use cheaper glass on the non-premium phones.

    My iPhone is 2 years old, the Sensation only 6 months and the new Mozart around 10 months old. The iPhone screen has a couple of hardly visible, fine scratches, the Sensation has no scratches, yet the Mozart got a couple of deep scratches within the first 2 weeks of use.

    That said, we've been unlucky with iPhones as well, with 4 handsets here being replaced a total of 12 times in 18 months!
    wright_is
  • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

    HTC lost their innovation and started taking too long to get updates out. Added to this was the fact that they locked the bootloader on their major products. Sure they are starting to unlock it now but it is not an easy procedure. The need to give users the option to upgrade android faster but without the SenseUI. Those who like it could wait. They seemed to sit on their hands after the success of the Evo. I mean Evo Shift and Evo 3d! Come on. I was an avid HTC user but they didn't offer anything to replace my Evo with so I went with Samsung.
    tommcd64
  • I called it

    I knew HTC would start losing money. It was only a matter of time before Apple, the 8,000lb gorilla, killed HTC too. So far we have Apple killing HP / Palm, Motorola, HTC, and RIM. Samsung and Nokia soon to follow although at least Samsung can juggle the books to make their smartphone and tablet results look better than they are.
    toddybottom
    • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

      @toddybottom
      Well, if we're assuming huge publicly traded companies can "juggle the books" that all earning results are basically meaningless (including Apple's). Also considering, Apple's market share have been consistent, where one of the other players fall someone else must rise (basic logic).

      We need to worry about companies that have monopolies now instead of companies that may have it based on some people's opinion (despite the company have consistent marketshare at around 30%). Windows has killed competition and been proven by the courts to be an illegal monopoly.
      anono
  • That's what happens when ...

    ... your company exists to only fight for the scraps at the bottom of the barrel.

    How is that "free OS" working now?? I guess the savings aren't really savings when every crapware in the world looks and feels about the same as your top quality products.
    wackoae
    • I agree with you, this is why we need real choice

      @wackoae
      Right now there is iPhone and there is cr@p made by companies who have to cut corners everywhere they can to produce products that aren't any less expensive than iPhones but aren't anywhere near as good. This is why I decry the lack of real choice. This is why Apple has a monopoly on the smartphone market. When consumers don't have real choice, they aren't any better off than having no choice at all.

      It is a sick market. We all lose.
      toddybottom
    • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

      @wackoae How would it be any different if HTC had to pay for an OS? There would still be a bottom of the barrel fight, just like there is with Windows PCs currently.
      K B
      • They don't have to "pay" for the OS ....

        @K B .... they just have to invest on making the OS actually better in their platform. They don't.

        They could just fork the OS and actually spend some time improving reliability and performance. Particularly, they could fix the constant freezes (requiring a battery reset to recover) and the annoying Android sluggishness.
        wackoae
  • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

    "The company???s revenue fell by $3.35 billion, a 2.5 percent decline on the previous year."

    Does this mean their revenue was about $134 billion?
    raleighthings
    • RE: HTC posts poor Q4 results: Loses Android mojo to Samsung, Apple

      Taiwan dollar 1 TWD = 0.0331 USD
      Partners in Grime
  • Too many products and none of them are like Galaxy

    ...
    kimdba