HTC has posted a 58% fall in profits, hit by weaker than expected European smartphone sales and its ongoing patents battle with Apple.
The news comes as Samsung Electronics posted record profits for Q2, up 79%, fuelled largely by smartphone sales.
HTC posted Q2 revenue of £1.95bn and a £176m quarterly profit, a fall of 57.8% year on year. However, the results are still an improvement on its Q1 results, which saw net income of just £111.3m.
HTC has been hit by the continuing economic crisis in Europe and its long-running patents battle with Apple.
The company had pinned its hopes on its flagship HTC One X reversing its fortunes in Q2. A major strategy shift saw it producing fewer smartphones and focusing on just a few high impact devices.
However, fierce competition from Samsung’s Galaxy S III, launched at the end of May, has impacted on sales.
To add to HTC's woes, Apple recently won its case to secure a temporary sales ban preventing the One X and EVO 4G LTE from being brought into the US. The ban was only lifted after HTC altered the disputed software.