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HTC blames weak Android sales for NT$5.1b Q2 loss

Taiwan's HTC has recorded a second quarter loss of NT$5.1 billion, attributing the shortfall to a 'weak' Android market.

Taiwanese smartphone giant HTC has reported an operating loss of NT$5.1 billion for the three months ending June 30, with an operating margin of negative 15.6 percent.

HTC has attributed its second quarter loss to a weak high-end demand at which it said was consistent with the current Android Market.

"While the current market climate is challenging, I firmly believe the measures we are putting in place to streamline our operations, improve efficiency and focus, and increase our momentum, will start to show results over the coming quarters," Cher Wang HTC CEO and chairwoman said.

"I am confident that our smartphone phone and connected devices strategy is the right one for HTC, and our corporate initiatives will ensure that we deliver on both our vision and business goals."

HTC's quarterly net loss after tax came in at NT$8 billion dollars, with the company posting revenues of NT$33 billion.

HTC said its year-on-year shipment volume increases were seen in select key emerging markets; however it produced no supporting data for this claim.

The Taiwanese company launched its latest smartphone offering, the HTC One M9 in March, with its release in Taiwan being postponed in March due to a software upgrade.

For the first quarter of 2015, HTC reported an operating profit of NT$20 million, net income of NT$360 million, and revenue of NT$41.52 billion.

Looking forward, HTC said it is expecting to invest in "promising new product areas", including virtual reality (VR), which the company said it is currently working with over one thousand developers on content creation over a wide spectrum of applications covering gaming, entertainment, and education.

HTC said the move into VR is to "ensure a compelling ecosystem" ahead of the launch of HTC Vive headset, currently tabled for release at the end of the year.

For the third quarter -- which only ended a week ago -- HTC expects its revenue to be in the ballpark of NT$20 billion. HTC also said it has begun to implement "company-wide efficiency measures" it hopes will reduce operating costs across the organisation and ensure resources are "appropriately allocated to future growth".

Last month, it was reported that Android boasted 1.4 billion active users, which saw the mobile operating system secure its lead as the world's most widely used operating system.

However, in August, the International Data Corporation (IDC) predicted that worldwide smartphone growth this year is expected to slow to 10.4 percent, with the once booming smartphone market in China taking the biggest hit; expected to grow by only 1.2 percent, down from growth of 19.7 percent last year.

The IDC found that China was behind 32.2 percent of all new smartphone shipments in 2014, however, China's share of the overall market is expected to drop to 23.1 percent by 2019.