HTC confirms first ever quarterly loss


Manufacturer makes loss of NT$3 billion (£64 million), and predicts further falls in revenue for the fourth quarter

HTC has confirmed its first ever quarterly loss, as revenue also continued to fall.

Reporting its financial results for the three months to September 30, the manufacturer said it had made a net loss of NT$3 billion (£64 million).

This compares to a profit of NT$1.25 billion (£27 million) in Q2, which was down 83 per cent from the previous quarter. For Q3 2012, HTC posted a net profit NT$3.9 billion (£83 million).

Revenue was NT$47 billion (£997 million), down from NT$70.7 billion (£1.6 billion) in Q2. Its third quarter revenue was below the forecast of between NT$50 billion (£1.06 billion) and NT$60 billion (£1.28 billion) made by HTC when it announced its Q2 results in July.

Gross margin in the third quarter was 20.4 per cent, while it reported an operating margin of -7.4 per cent.

HTC has forecasted revenue to be in the range of NT$40 billion (£848 million) to NT$45 billion (£954 million) in Q4, with gross profit margin expected to be 20 per cent.

During Q3, HTC released the One Mini and One Max smartphones, as well as the mid-range Desire 601 and entry-level Desire 300 handsets.

The manufacturer also sold back its remaining 24.85 per cent stake in Beats Audio for $415 million (£258.6 million) to focus on the development of its own proprietary sound technology, HTC BoomSound.

It also sold all of its stake in digital content provider Saffron Digital to Cinram, a service provider for the entertainment industry, for $47 million (£29.3 million).

HTC CEO Peter Chou (pictured) said: “We have delivered good progress in the third quarter, with the introduction of HTC One Mini and One Max, we now have an HTC One for everyone.

“We have also launched the Here’s To Change global brand campaign, affirming our role as the change-maker challenging the status quo since the dawn of the mobile phone industry, as well as our mission of continuing to bring change into the hands of people around the world.”