Emily Tan
Dec 7, 2011

HTC’s slump continues with 30 per cent month-on-month plunge in November sales

GLOBAL – Taiwanese mobile phone maker HTC seems to be caught in a perfect storm with falling sales and legal troubles. In November the world’s fourth largest smartphone manufacturer slashed sales forecasts for the fourth quarter by 23 per cent, and recently has posted November sales figures 30 per cent down from October.

HTC's phones and brand may not be enough to save it
HTC's phones and brand may not be enough to save it

Spotted by The Next Web, HTC posted November consolidated sales of US$1.03 billion, down from US$1.46 billion in October and 20 per cent lower than its sales in November, 2010.

Late last month, HTC lowered its fourth quarter revenue estimates by 23 per cent, citing increased competition and challenging economic climate. This ends a winning streak for HTC with sales in August peaking at US$1.56 billion leading to its year-to-date figures (January – November) jumping 80 per cent from the same period the year before and leading the US smartphone market in the third quarter.

Yuanta Securities analyst Bonnie Chang told Bloomberg that it was expected that HTC’s sales growth streak would grind to a halt. “HTC doesn’t have the same sparkle, lacking both the design and marketing of Samsung, while they’ve declined to go into the low-end phones which are popular in China,” said Chang.

HTC faces further challenges on the legal side, losing a patent-infringement case against Apple which prompted its US$300 million purchase of S3 Graphics. Apple, in turn, may win a December 14 ruling against HTC that will block its sales into the US – HTC’s largest market. There is also the possibility that the Taiwanese tech firm may have all its smartphones blocked from sale this month in Germany – Europe’s largest smartphone market.

In response to these fears, its shares have taken a hit on the stock market. On Monday, its shares fell to their lowest level in 17 months in Taipei, reported Bloomberg.

To reassure investors,  HTC has promised competitive new global flagship products early next year, but analysts remain unconvinced. Reuters reported Mirae Asset Management analyst Roxy Wong’s comments that HTC lacked an edge in branding against Apple and Samsung. “Its industrial design hasn’t changed for almost two years,” she said.

With the smartphone market as a whole slowing down, HTC will really have to up their game to compete with Apple, Samsung and a resurgent Motorola, Nokia and Sony, Abhishek Chauhan, principal consultant at ICT Practice told Reuters.

 

 

 

 

Source:
Campaign Asia

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