HTC July sales down 51%

HTC July sales down 51%

Taiwanese smartphone manufacturer HTC has announced revenue of NT$10.6bn for the month of July, down 51.6% compared to the previous month, and a 32.6% decline in year-on-year results. The phone maker's cumulative revenue for the first seven months of the year was NT$108.8 bn.

HTC recently posted a revenue fall of 7.9% for its second quarter to NT$65.1bn with net profit (after tax) of NT$2.3bn. The company predicts that revenue will fall between T$42-T$47bn in its July-September period. It reported revenue of T$47.05bn in the same period last year.

Analysts believe the decline in revenue relates to HTC's flagship phone, HTC One M8, having reached its peak. Released to the market in March, sales performed strongly following the launch. However, the July figures show a stark drop compared to the previous month's revenue of NT$21.917bn and revenue of NT$15.728bn in July of last year.

HTC says it expects strong shipments numbers to emerging markets in its Q4 with predictions for shipments to China to increase by 20-30% in the period. The company may also release a new Nexus tablet amd a smartwatch before the end of the year.

Neil Mawston of Strategy Analytics believes that while HTC is making some good smartphones, the message is not getting through to consumers, businesses and mobile operators.

He told Mobile, 'HTC's brand has lost its shine. It took a major battering after it lost huge market share in the influential US smartphone market a few years ago, and HTC has never really recovered from that episode.'

HTC got months of bad press in the US and the negative perception seems to have stuck globally, he explained.

Meanwhile, CCS Insight believes that HTC is facing a long road to sustainable margins and all-important scale with its analyst Jasdeep Badyal telling Mobile that with product life cycles shortening and marketing and channel investment requirements remaining considerable, HTC can take nothing for granted.

'However, its reputation as an outstanding device manufacturer and its support from partners suggest a more positive outlook for the Taiwanese company,' said Badyal.

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