HTC has one other robust quarter, with income down 13% YOY, however smaller losses


HTC’s newest financials make for one more pretty dismal learn for the cellular gadget and VR headset maker, although — crumbs of consolation — it’s making a barely smaller year-over-year loss. Its working loss for This autumn 2016 was NT$three.6 billion ($116.8M) vs a lack of NT$four.1 billion ($133.1M) in This autumn 2015.

Income for This autumn 2016 was additionally down at NT$22.2 billion ($720.7M), which is a year-over-year drop of round 13 per cent. Not nice information, clearly, however much less of a YOY income slide than in different latest quarters.

Nevertheless gross margin declined yr over yr too, dropping from 13.9 per cent in This autumn 2015 to 10.5 per cent in This autumn 2016. Whereas HTC’s yr over yr working margin was virtually the identical, at per cent for the quarter.

In its report for This autumn, HTC claims “robust sales performance” and notes sequential income “improving sequentially over 2016”, although income was truly flat between Q3 and This autumn — at some extent within the gross sales cycle whenever you may expect a vacation increase to earnings.

HTC Q416


HTC additionally flags what it describes as “aggressively managed” working expenditure delivering a 34 per cent value discount for the enterprise over the course of the yr.

However effectivity financial savings can’t in themselves beget enterprise turnarounds — that requires a string of product wins. And digital actuality is a dangerous wager for HTC to be making for that, given the dearth of confirmed client demand for such a nascent tech.

In recent times loss-making quarters have change into the norm for the Taiwanese firm, which posted its first ever loss making quarter in Q3 2013. Since then, the raft of administration adjustments, portfolio tweaks and a partnership with video games writer Valve centered on digital actuality have but to translate into any sustained upward momentum for HTC’s enterprise.

On the product entrance — past its ongoing efforts to tout its Vive VR play — This autumn noticed HTC put out a number of mid tier handsets badged with current/long-in-the-tooth model names, reminiscent of Need and Evo.

Notably it’s since launched what it dubs a “new direction” for its telephones enterprise, saying final month a brand new cellular model, HTC U, for a spread of handsets pre-loaded with a brand new AI assistant. Not having a a lot wanted smartphone refresh able to go in This autumn clearly didn’t assist its gross sales efficiency within the quarter.

HTC was additionally the design and manufacturing companion for Alphabet’s new Google-branded Pixel handsets, which launched throughout the quarter. However there are few indicators that relationship has translated into substantial gross sales income for HTC.

Its This autumn report gives little element on any future plans, merely pointing to its continued funding of effort to attempt to ascertain a sustained marketplace for VR.

“HTC continues to build the virtual reality ecosystem around HTC VIVE, with several events underlining the growing reach of the Vive platform, including opening the first VIVE-based arcade in Taipei, first demo days for VIVE X accelerator program in Beijing, Taipei, and San Francisco, and the launch of VIVE studios,” it notes.


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Désiré LeSage


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