HTC

First operating lo​ss in company history despite strong sales of HTC One

HTC has just released its preliminary unaudited financial results for the third quarter of 2013, and the company has posted an operating loss of over $101 million (NT$2.97 billion). Just as it warned back in July, this is HTC's first operating loss in company history and it wasn't even close to breaking even. Here's how the quarter's financials break down:

  • Total revenues of $1.6 billion (NT$47.05 billion)
  • Operating loss before tax of $119.4 million  (NT$3.50 billion)
  • Operating loss after tax of $101.3 million (NT$2.97 billion)
  • Earnings per share after tax of -$0.12 (-NT$3.58)

Compare that to earnings in Q2 2013 that hit its own estimates with $2.35 billion (NT$70.7 billion) in revenues, $42 million (NT$1.25 billion) in operating income and earnings per share of $0.05 (NT$1.50). That's quite the downturn, and even though the company predicted it, it still hurts when the numbers finally come through.

Source: HTC

 
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HTC announces $101 million operating loss for Q3 2013

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Please don't let HTC go the way of Palm. Sure they have had their issues, but they're doing what they can I think to make a comeback. Just as well the other manufacturers of Android phones all have their own idiosyncrasies.

That being said...someone BUY THEM already...(just not DirecTV)!

They could merge with another company from Taiwan like Lenovo or Asus and Acer. I would hate to see Htc disappear.

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Their marketing team is just horrible, especially with RDJ, they spent a ton of money on a 15 second ad. Would've been better showing off the features of the One.

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AGREED.
I just don't see why they wasted time & money on that stupid ad with RJD. Nobody cares what HTC could stand for. Make a good phone and market it right. Show off all the cool features like Sammy is doing with the Galaxy phones..

Geez. Sounds like these guys share an advertising dept with BlackBerry.

Their superbowl commercial blew a huge wad of advertising dollars and said NOTHING about the products.

Tough pill to swallow...let's hope they're not quietly dying especially after a blockbuster phone.

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I hope EFFBook paid for all those crappy phones from earlier this year that never sold. I saw that failing the day it came out. Wonder if they all went to Africa like Losing Sport Team clothing items

It's unfortunate 1.6 billion revenue isn't enough to pull a profit in the smartphone industry. Assuming there isn't something that could be fixed internally. If I were to put my armchair Ceo hat on I'd say they wasted way too much money building HTC one minis and megas. The reguler HTC one was enough.

This.

Plus they blew their wad big time on marketing dollars that did not come near the return on investment they had hoped.

They came to the big boy table against Apple, Samsung and LG who all have diversified profiles and decades of experience in marketing and operating big product releases. Let's not forget, HTC only does this.

This won't be the end of HTC considering the 1.6 billion revenue they generated, but it was an expensive lesson learned.

Actually, for me no. I wouldn't buy the HTC one because I think it's too small for my usage. I had a Note, and then a Note 2. Now the minimum size screen I would buy is a 5 inch device and even then it's a downgrade. But I REALLY wanted the HTC One, but screen size was the deal breaker. Hardware was awesome, I wanted it. But I'm holding out for the oversized version of it! THen I'll compare the Note 3 and Z1 and Nexus 5 to it and pick whichever is best for me :)

But I think small screen companies need to invest in large screens too. HTC :cough: :cough:

But true, this is sad. I want them to continue! The more companies we have in the market the better for the consumer.

There's a plethora of ugly phablets out there and normal screen sizes are becoming a rarity. I hope Nexus stands up to this silliness and doesn't go over 5 inches in screen size.

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Thank you!! After using the Moto X I can't go back to these ridiculous screen/phone sizes. To actually be able to reach the pull down notification bar with your thumb without having to maneuver your hand up the device while hoping you don't drop it is priceless. I believe there is a market for phablets, and it's great that we all have choices, but to say a 4.7 inch screen is small is crazy to me.

They were "solely manufacturing cell phones" in previous quarters and they posted profits.

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Apparently the innovations aren't enough and the fragmentation in late 2011 and into 2012. Not supporting all of the services that they have out. I'd mainly put it on the lack of innovation. That and Samsung's marketing genius.

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The first aluminium android smartphone? A new look at the way cameras should work on phones? Refining the way we listen to things on our phones with two extremely powerful and clear speakers? Plenty of innovation. Not enough successful marketing.

Posted via Android Central App using the brilliant HTC One. Also I like bananas.

Correct, HTC has been the most innovative Android manufacturer hands down. The Evo was revolutionary in opening the flood gates for the large screen devices.

Lack of support for previous flagship models. They forgot about their customers once they bought a phone.

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They brought out the best looking Android phone that is comparable with the iPhone in design and style. No other Android maker has managed that.

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I think they're headed the right direction in terms of product, and that is the most important thing. They have suggested that they knew they might take a loss because of what it took to put out the One series; in that case, they'll be fine because they now manufacture the best Android phone. If the issues are actually due to mismanagement, inefficiency, or something like that, who knows.

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In some countries I would say the product matters. In the us, it is all about how well you market and promote things. Look at beats, super overpriced for how well they work, yet people can't atop buying them! Marketing in the US can offset any product shortcomings.

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Guess there's something to be said for the profitability of cheap plastic vs expensive brushed aluminium.

There is nothing bloated about HTC sense. It is much better than stock android. Now touch wiz is what I will call bloated. That phone lags so much.

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Well of course it is my opinion. Am I not the one that said it? I will never buy another nexus phone ever. Imagine Google just added dial by name after all these years. The camera app is barebone and bluetooth metadata streaming was just added. Something other phones have been doing for years.

I don't know what the obsession is with stock Android. What's the point of having a powerful phone, without any added software features to take advantage of it? Like, how boring would the G2 be without LG's software features?

Posted via Nexus 7 (2013)

Besides camera app (which certainly could be a unique add-on), what other features you are so found off? I ended up disabling all GS4 "features" and would do the same on G2. I don't mind having a choice to download features but I hate it when I can't even remove them.

Stock android gives you a blank canvas to create whatever you want.

Why do I have to be obsessed with stock Android, to prefer it?

I guess I can ask you: why are you obsessed with bloatware? That sounds stupid, right?

I love the bare bones feel, to be honest. Coming from a Galaxy S3 and Note 10.1, I've come to appreciate the lack of bloatware, the inexpensiveness of the Nexus devices, and the stock UI, for what they are.

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Agree completely. Stock Android is nice and does the job well. All the different manufacturer skins confuse people about Android. So they buy iPhones instead.

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Agree completely. Stock Android is nice and does the job well. All the different manufacturer skins confuse people about Android. So they buy iPhones instead.

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I don't know if touchwiz lags or not. Performance can vary because of how you use the phone. I do know when the sgs3 came out with touchwiz and SAMOLED screen, I faintly whispered "nooo..." in my school library lol. I picked up a One X and it's a good device with a good dev community in xda. HTC's super LCD is amazing!

Im not understanding where you are getting these statements from.

Sense has been streamlined a considerable amount since the old 4.0 days, yes sense was garbage back then but 5.0 has actually done a great job

In regards to the home screens you are just plain wrong. I am able to add more than 3 home screens on my HTC One sitting right in front of me.

And by no means am I an HTC loyalist. To be perfectly honest I was all ready to pick up my GS4 when it was out on Sprint, no questions asked. But the more i read about the two the more I found I liked One (as did many of the reviewers)

I went and played with both and surprisingly saw some stuttering on the GS4 and none on the HTC One. It was at that point that I grabbed an HTC One and never looked back.

Bottom line is don't use antiquated ideas of how a phone used to run and look at all products with a bias-free mindset

LOL! I almost spit out my coffee on this one. Sense 5 is by far the best Android skin to date. There is nothing bloated about it.

For me it's all about flexibility and features vs. looks. Why buy a phone with a smaller screen (same size case), no removable battery, no expandable storage, no wireless charging option for the same price. Most people will put a case on a phone so what's the point to the expensive shell? The HTC One only appeals to a small percentage of people because when it comes down to it most people will use logic over looks...

Regular folk aren't buying Samsungs because expandable memory or removable batteries.

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A corporation does not turn on a dime, more like an aircraft carrier.

It take time and miles, but you have to set the right course first.

HTC is doing well on setting the right course, they just have to keep turning and not panic

Agreed. I think a stock experience available on all major carriers with excellent build quality would sell extremely well. To this day there is no such device. Moto X is the closest thing.

This kind of phone would be constantly talked about in the media (free marketing).

Stock is terrible. It is a barebones os, consumers want out of the box features. Not to go hunting for them

Posted via your wifes, girlfriends phone

It's not. I prefer stock Android, but the general public doesn't. There's really nothing special to promote about it.

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That was kinda my point above. Promoting a nexus like an iPhone would be terrible

Posted via your wifes, girlfriends phone

Marketing is. When you have no money for marketing, you make something that media will talk about and promote.
Stock Android is media favorite.

Got any other ideas? Because clearly what they are doing now ain't working.

Tech media favorite. Sure. Regular/traditional media? Don't care.

Look at the Moto X. Near stock UI. Yet Motorola's additions are what's going to bring in the regular folk.

But again, what would you suggest they try? This would be the cheapest solution to try since they have nothing to lose. I mean, they are actually spending money making changes.

I also highly doubt I'm the only person in the world who didn't even consider HTC One because of the awkward button layout. And because of that I don't recommend this phone to anyone. It kinda grows exponentially.....

Sure, this is not the only reason for HTC problems but it's one of them.

Moto X is a great phone and will sell because it's heavily marketed, can be customized and has the best combination of pure Android and cool add-ons.

So again, what do you suggest?

The Moto X will sell well because it's heavily marketed. Everything else you said, "can be customized and has the best combination of pure Android and cool add-ons", isn't significant.

"Can be customized" - applies to all of Android.

"the best combination of pure Android and cool add-ons" - Pure Android doesn't matter to the general consumer. The add-ons do.

As for HTC?

- How 'bout not spending so much on Robert Downey Jr.?

- Push the front-facing speakers hard (though with the Beats partnership done, this may be a tough sell)

- I don't recall seeing any ads about Zoes/Zoe Highlights.

- I don't recall seeing any ads about the camera's low-light performance.

The only people that even cared about the button layout were tech enthusiasts. I know several "regular" users who have and love the ONE and they don't think the button layout is odd. I think it was odd because I was used to onscreen buttons but my wife went from the iPhone to the ONE and didn't miss a beat.

Honestly, I think the HTC One's front facing speakers are the most revolutionary advancement in smartphone technology the past several years.

I hope HTC survives so that front facing speakers become standard in high end phones.

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I agree BoomSound is good, and that front-facing speakers in general make a lot of sense... but calling it "the most revolutionary advancement in smartphone technology the past several years" is so far from the case.

They put speakers on the front of the phone, they didn't revolutionize anything with that choice.

I'd expect every company to have that same type of marketing speak for everything they do though.

OUCH!

That's bad news! However, the One is selling pretty well and if they keep it up, and keep the updates rolling on time (and stop ditching older devices in such a short time), they'll be able to see the light at the end of this really long tunnel.

Isn't that what they paid Robert Downey Jr. for those horrible ads?

Whoever thought those were a good idea may be the reason HTC follows palm and blackberry into oblivion.

Companies like BlackBerry I hope die. But HTC is just so much better and I hope they can turn around somehow

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I don't want either company to "die" that would suck for all their employees I really hope Htc can turn it around my wife has had 3 htc phones and loved all of them, (Raider / vivid, Htc one x and now the Htc one. They need to focus on marketing it's the only way to get the brand awareness most consumers don't buy a Samsung or Iphone for what it can do but for the name "brand"

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why would you hope death to a company and the jobs of 5000 people.

Does blackberry phones in the world hurt you in some way?

Yeah, unemployment sucks. I would never wish that on anyone, even considering a company whose products I don't purchase anymore.

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Sprint better get their stuff together soon.

Sincerely,
Former customer of 8 years who kept expecting a network to be built.

Mindshare. They can't compete with Samsung and Apple in marketing and they don't have a wide portfolio of other businesses like LG and Sony.

Well, hopefully someone (like Google) will buy them to make them better.

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Google couldn't if they wanted I would think.

Buying two OEMs in 3 years would have regulators salavating

Posted via your wifes, girlfriends phone

I could see ASUS or someone of the likes getting interested in them. I'd personally be happy to see that acquisition.

I really hope HTC can make a comeback. I have always been impressed with their hardware!

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It's a corporation with limited liability, no reason for me to be so concerned for it unless you're a share holder. They still have billions in their revenue. My recommendation is they spend a billion for the next SuperBowl and TV/ads campaign., because that's one of the main reason how Apple and Samsung got popular.

I certainly don't want them to go away, but personally I think they haven't treat their userbase better. I could go on a rant from an the open source community point of view but I rather not, even if that's only 0.01% of HTC userbase and would just get eyes roll by other readers I don't care, it's why I don't buy their stuff on a personal level and they've shown they won't change.

Unless HTC is state-owned and/or Taiwanese law prevents mainland ownership or investment, I would think a Chinese billionaire would be willing to invest whatever capital is necessary to keep the company afloat.

China is bursting with money and minting new billionaires at a rapid pace. They have a lot of money to invest. A global company with strong name recognition and first class products like HTC would add a lot of prestige to any portfolio.

In my opinion the HTC One has so many great "marketable" features such as HTC tv , sense 5 (love it or hate it), Zoe , boom sound and build quality. It is a great phone that just was not marketed correctly.

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In before "Do you hear me Chou????!?!?!!?!!?!!!"

Also, I think what HTC is still doing wrong at this point is spending money in the wrong places in marketing. Samsung's ads really got through to people, and HTC needs to do something like that.

HTC builds some of the best phones. Sad it isn't enough for them to break out of that slump they are in. Samsung no offense doesn't build better phones but just over the years got all the attention and when ppl think on android they think Samsung. Is like it only exist I phones or Samsung Galaxy phones. Nothing else. Good for Samsung, bad for other manufactures. Quality doesn't matter newer days anymore. It is all about marketing and promoting. U can sell shit with the right marketing and promotion.

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Yeah I buy Samsung because they're so easily rooted and hacked and such forth hencetowith. Familiarity and all that, knowing what I'm in for as soon as I get it.

They still feel icky and slimy though and always get chunks out of the bezels during the many involuntary drop tests (due to the slimy slipperiness).

That would definitely be different. Imagine, not having gas money for your car or to make a phone call...

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Further proof that trying to market your way out of the gutter never works. It only digs you in deeper.

IMO, their 2011 lineup probably hurt their mindshare. People coming off of those devices probably moved to a different OEM.

Sadly, I agree. 2011 was the year, for the HTC One. I believe, Phil even wrote an article, about the One, two whole years before it was released.

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Sad, even if expected/ forecast.

It would enhance our understanding if the revenue figures could be broken out by markets -at least regionally (like Asia, U.S./Canada/N.A., Europe).

That would help our understanding for which markets are supporting the phone and where it is lagging.

(I still recall reading how HTC exited at least portions of the South American market, and while it was puzzling, I guess it made economic sense to the company based on sales.)

Anyway, here in the U.S. the HTC One is one of the top phones --and it would be surprising if this market did not have a positive balance sheet.

As one of the earlier posts mentioned, the cost of the standout aluminum frame must have really eaten into the profit margin.

I think Verizon contributed a lot to this dragging their feet releasing the ONE so late. I'm sure I'm not exaggerating when I say many thousands of people bought the Samsung S4 because they got tired of waiting. I'm not an industry expert nor am I privy to the backroom deals that go on in the smart phone wars but Verizon's "failure to launch" doubtless hurt overall sales of the ONE.

I got so sick of waiting and then being faced with full retail price to keep my grandfathered unlimited plan with Verizon that I finally got fed up with their bullying and jumped ship to AT&T. This was a change I did not take lightly but Verizon certainly didn't give a shit until I was gone and my $2,500 a year payments went with me. Now they want to know "what can we do to get you back?" LOL Assholes! Maybe you should have kept me satisfied when I tried to negotiate a deal to get this phone and keep my data in the first place.

Oh well, back on topic. Verizon has a stick up their ass about their relationship with HTC and I really don't know why. Exhibit A your honor, the DNA, which is a good phone in its own right but was totally dictated to HTC by Verizon and released nowhere else. HTC had no choice but to produce an "exclusive" phone for Verizon which must have cost them a fortune only to see Verizon sit on their release of the ONE for 6 months while Samsung and even LG racked up sales at their expense.

If I was an executive of HTC I'd kick the CEO of Verizon square in the balls in public and personally post it on YouTube. I bet HTC sales would skyrocket. You don't see Verizon pushing Samsung or iPhone around like this.

Verizon had nothing to do with the poor sales of the HTC One. The Sprint Samsung S4 spotted the HTC One a month of sales opportunity yet still crushed the One in sales. It didn't sell well on Sprint and It hasn't sold well on Verizon. It wouldn't have sold well on Verizon had it been released earlier.

Last I heard, Verizon came to HTC asking to make the DROID DNA. The Butterfly models spawned out of that effort.

Did you want HTC to turn Verizon down?

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If only htc listened to what people wanted.. Battery life/bigger battery? micro sd slots?.. And that ugly 2 button design and 4 ultrapixel camera (at least 8 would have been great).. The one could have sold more than the s4.. And the one max coming out will be a disaster (you heard it from me first) , it will be too big and i read they packed it with snapdragon 600.. Really htc? That wont even compete with the note 3.. Come on htc.. Ive been a fan since desire hd.. Sort your shite out..

"If only htc listened to what people wanted.." It took me three years of being an HTC fan before I finally realized that this will never happen. The 2012 One X was the most useless, constantly reloading piece of crap android phone I ever owned. Being told by HTC that they designed it that way on purpose so that users could still get the Sense "experience" was the last straw for me.

The iPhone is proof enough that expandable memory and user-replaceable batteries aren't top priorities for most buying decisions.

Posted via Android Central App

HTC Windows Phone 8X is a good phone. I know two people with it and both say they love it. I spent a bit of time checking it out and though Windows has much to be desired its not that bad and the phone itself was impressive and felt solid.

My point on this is that they should have surveyed how windows phones were doing in sales... Waited it out.. Coz phones with windows dont sell well compared to android phones..

Good Point. I never thought about that but you are right. I liked the HTC Windows Phone 8X but I would have never bought one myself since it wasn't android. An "HTC Android 8X" would have sold much better.

If HTC were to fail, it would break my heart, for there's no other phone I wanted more than my HTC One. I'm still very happy with it and look forward to buying next year's HTC One.

Posted via HTC One on Android Central App

I like HTC, I really do but lately their support department has been shoddy. I don't suppose Google will help HTC like they helped Motorola a couple years ago.

I sure as hell am not supporting Samsung with their laggy Touchwiz and overpricing, so there would be LG left since I also don't really like Motorola. LG do make good phones but I've been left with a sour taste in the last couple LG phones I've owned.

I don't care HTC still made the best phone of the year. Gotta spend money in order to make money! Sure they have a game plan and it doesn't seem like they are to worried about it. As a consumer I'm more than happy with my HTC One.

Hopefully, the company gets it together because I really like HTC smartphones. I owned the Evo 4G previously, and I'm currently very pleased with the One.

Personally, I feel like my family, friends, coworkers, etc. all have iPhones or Samsung devices, so news of loss profits isn't shocking, and wouldn't be even if HTC hadn't announced this was likely to happen months ago. And now that I think about it, the popularity of those other devices somewhat played a part in my decision to get the One. I sort of don't want the same phone as everyone around me, so it's great having a comparable or superior option, like HTC.

Posted via Android Central App, HTC One

Same here; everyone seems to have either iPhone, Samsung or LG, the other phones are very much in the minority.

Posted via Android Central App

I hope they get to make a Nexus phone soon, they make great hardware and I think it would give them a boost.

Posted via Android Central App

and who says going to android will make u money? not knocking android.. but so many people think if a company is going down (ie BlackBerry) should switch to android... BB probably woulda went down much faster if they went to android.. woulda probably cost billions just to switch

Yes Samsung is broke.

Trust me when I say it would not have taken billions

Posted via your wifes, girlfriends phone

I've owned five HTC phones with the latest being the Rezound. Unless they get their crap together It'll be the last one. Batteries too small and not removable. HTC sense buggy and sluggish. There saving grace for some time was the unlock-able boot loaders but with all the driver issues from them being so intertwined with Sense it's just a pain. They used to be quietly brilliant, now they're just irritating.

As much as I don't want to pick on him, he publicly stated he'd step down if things got bad for HTC.

Now the question is, "were these results bad enough?"

Posted via Android Central App

I never got the hype over the One in the first place. Metal phone? So what. I guess its better than crappy Samsung plastic, but I never had an orgasm over a metal android phone, or iPhone, like so many others. Other "features" of the One are a joke to me, aka Zoe, blinkfeed, hate sense, boomsound, only 4 home screens! Honestly I think it is a terrible device. Having owned a HTC device in the past that was garbage, I guess I'm just not a fan of HTC designs and functions. Not a fan of Sammy either. I like what LG and Moto are doing, but I really prefer the nexus experience I suppose.

Posted via Android Central App on my white Nexus 4 with StraightTalk

I never understood the hype about any Android phone that came out after the original DROID.

Posted via Android Central App