HTC posts bigger than expected Q1 loss on poor flagship phone sales

HTC posts bigger than expected Q1 loss on poor flagship phone sales

Summary: The Taiwanese phone maker reported worse results than analysts expected after losing ground to competitors and rivals.

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TOPICS: HTC, Smartphones
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HTC One (M8), the critically acclaimed smartphone, announced earlier this month (Image: CNET/CBS Interactive)

HTC has reported a bigger-than-expected loss for its fiscal first quarter as it continues to struggle against its major rivals in the smartphone space.

The company reported a loss of about $62 million, compared to an $85 million profit in the same quarter a year ago, despite its flagship smartphone line being critically acclaimed by reviewers.

Analysts were expecting a loss of $52 million.

HTC said it generated $1.09 billion in revenue for the January-March quarter, a decline of 22 percent in the year-ago quarter.

The company, which was once third-place behind Apple and Samsung, now has two percent of the global smartphone share, down from more than 11 percent in 2011. 

In efforts to stem the financial bleeding, HTC's chief executive Peter Chou offloaded more of his responsibility with the company's chairwoman and co-founder, Cher Wang, late last year. 

Earlier this month, the company launched the latest iteration of its flagship phone, the revamped HTC One (M8), which it hopes will resonate with its customer base away from Apple and Samsung.

ZDNet's sister-site CNET gave the smartphone a 4 out of 5 rating — one of the highest ever given for a device — describing it as a "truly great phone all on its own — one worthy of anyone's investment."

Any successes the new flagship phone has will be reported in the company's fiscal second quarter earnings, expected in early May.

Topics: HTC, Smartphones

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18 comments
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  • Merely good product base doesn't help in getting market share back.

    HTC provides good products but at a premium, and the customers who pay a premium expect premium services as well in terms of after sales.
    HTC must work on their after sales support as well (especially in Asian countries where they outsource it) and and try and project themselves not only as premium product makers, but also as premium service providers :P
    goelanshul
    • Nah

      Sense has become a pain to use and people want more MP for the camera.

      The google play edition is probably better but, HTC as a whole is clueless.

      My brother has the HTC One and he liked it at first but, now, not so much.
      slickjim
  • Gimmicky in a bad way.

    Lately I always thought that HTC has become too gimmicky. Other manufacturers like Samsung and Apple include gimmicks now as well in an attempt to make the formfactor more "innovative" but at least their gimmicks work. Sony's top devices are waterproof. Apple has a fingerprint scanner that is actually in a convenient position. Samsung keeps the exchangable batteries (which is why most people buy Samsung anyway here in Germany) and the S5 comes with the pulse sensor and the whole fitness thing.
    HTC has a 4mp camera and you can change the depth of field... Which doesn't even work (I tested it when I got the demo unit for my store. It's complete and utter crap).
    A full aluminium body is AWESOME! Don't get me wrong. But people don't really seem to care about that from my experience. If they did I would have sold more S4s than M7s. But I didn't.
    And then there is the camera... 4mp are kind of enough for snapshots (I would have prefered 6mp though) people just don't care about that! Most people still believe that more pixels mean better quality. And while it's true that the M7 and M8 are great for low light photography and closeups the images do tend to fall apart when your subject is a little further away and has lots of details. Was a new and bigger 6mp sensor so much to ask for? Smartphones are about to completely replace compact cameras. The HTC M7 and M8 don't do that in my opinion.
    mathiasappel@...
    • it is simple. HTC lacks practicality

      Samsung beats everyone with practical features. They win.
      It is not enough to make a heavy slippery aluminium phone that just looks good.
      Users want practical features like SD card slot, removable battery, physical home button, practical software features like smart stay and notification panel that's so customisable that you can hone it to perfection.
      Onscreen buttons are the wrong way to go, follow Samsung, and give us the physical home, menu, back buttons. Do not take a shortcut by dropping any of these. Phone screen space is precious, don't waste any of it for onscreen buttons.
      Samsung's flagship phone is not the S4 or the S5. It is the Note3 and nobody is making a Note3 competitor.
      Note series users are THE hardest to convert. Samsung wins until somebody tops the Note3.
      The phablet is the way of the future. options like the S4 and S5 are just compromises.
      Don't try to make a phone. Try and make the best pocket computer that's also a great phone.
      warboat
      • Only a small percentage want gigantic phones

        Made for people with basketball player hands. Simple but true.
        Bruizer
        • gigantic phone too big

          So lets have a tiny phone and carry around a mini tablet everywhere
          warboat
  • Great device

    For a year I groused about not having the perfect phone to upgrade to. I looked at all the options from Samsung, Sony, LG, HTC and found them lacking in one respect or another. Nothing fit my ideal. So, I soldiered on with my old smartphone to the bitter end. Finally, I was presented with a deal that was hard to pass up, on a new HTC One (M7). I reluctantly pulled the trigger and took delivery. I'm so glad I did. A truly beautiful device that works as smoothly as it looks. The phone arrived with Android 4.1.2 but immediately updated to 4.3, and within a few days T-Mobile released the update to 4.4.2. So, it sports the latest version of Android and Sense 5.5. Sense works seamlessly, isn't clunky or intrusive. I'm trying to get used to Blinkfeed, but now it can be turned off if you don't want it. Battery life is amazing, the screen is the perfect size and the picture quality far surpasses the Samsung S4 and Sony Z1s that I had previously considered. The camera suits me fine. I've only printed out a couple of photos to 5x7 size and they still looked amazing. Perhaps if I wanted larger I would begin to see some pixelization, but really, how often do people do that, now?
    fuzi0719
  • HTC needs to think beyond the sale

    I had the Incredible, loved it, and replaced it with the Rezound, simply because I trusted HTC. Never again. I was delighted when it finally failed and, after the first warranty replacement failed, eagerly accepted the apology that the Rezound was no longer available. Never again!
    jmccauley@...
  • They need to make a bad ass windows phone

    Samsung owns the android market, that battle is 90 degrees uphill, meanwhile wp8 is wide open with a huge upside. Especially in Verizon.
    everss02
    • nope, nokiasoft has the wp8 market in its claws even more.

      You are suggesting that HTC have a chance to compete against the Nokia phone manufacturing dept now owned by Microsoft themselves... Yeah that sounds like a huge opportunity.
      frankieh
    • I loved my HTC 8x

      Not sure why HTC abandoned the Windows Phone 8 market.
      ye
      • Almost no sales

        That's why.
        And if Samsung have 40% of a huge market, Nokia have 90% of a small market.
        HTC windows phone adventure was as for now, a waste of resources.
        AleMartin
      • Keep the Faith

        On of the HTC product managers told me that an M8 variant is being prepped for WinPhone 8.1. He suggested a late May release date.
        Curtis Quick
      • They couldn't match Nokia in volume

        They make great phones, but Nokia has become synonymous with Windows Phone 8, and that's mostly what I see in WP8 hardware.
        William.Farrel
  • It is a bit of a shame

    Sad when a company puts out a good product, and the media lauds it as a great product, and yet the company can't seem to make it profitable. Doesn't bode well for the HTC One M8 in a tough market segment.
    rphunter1242
  • apple and M$ taxes are to blame

    you should never concede od make deals with the devil(s)!
    LlNUX Geek
    • Andriod is not working for them!

      Each quarter is a new loss and Android is the platform they chose to innovate on, looks like it's time to reinvent their phones and make something worthwhile.
      Neverhood
    • Blah, Blah - Blah, Blah, blah.

      :)
      William.Farrel