HTC has revealed its Q2 earnings and it shows great profit fall. Moreover, the present ailment will continue even in the next quarter, reported the company on Friday.
The Taiwanese smartphone maker has reported a massive decline in profit and revenue in Q2. The company's quarterly revenue was $3.04 billion U.S., 26.8 percent down from the previous year. Both gross margin and operating margin have also declined 25 percent and 7 percent, respectively.
HTC had already cut its guidance for Q2, noting "lower than anticipated sales to Europe, and the delayed shipment and launch of certain products in the US."
In a statement today, HTC said that "Asia regional sales met expectations since the One family launched in Q2". It also noted that "with growing brand awareness, strong operator partnerships and increasing retail presence, China is well positioned to become a key growth driver."
According to the report, HTC will be expecting revenue of US$2.3 billion to $584.3 million range, compared to $4.54 billion in the third quarter of 2011. The company's operating margin will be around 7 percent, down from last year's 14.86 percent.
The company, however, said it "continues to optimise organisational structure and resources to increase efficiency and competitiveness, focusing on key growth areas."
According to HTC CFO Chang Chia-lin, the Chinese market "will be a key driving force for our future growth" and that HTC has to work harder to bring in customers. "We will continue to invest in the future, but we will allocate resources to focus on key growth areas, such as production innovation, sales and marketing," he added.
HTC, whose sales started seeing immense growth since 2010 and reported six consecutive months of record revenue (in 2011), started losing the ground from the second half of last year. The reason for their loss was the increasing popularity of Apple's iPhone and Samsung's Galaxy models.
This year, to add more fuel to the situation, the company witnessed severely falling sales in European market, and devices released for the U.S. market were held up long time for customs inspections. HTC also has shut down operations in Brazil and in South Korea. While the company had pinned hope with the launch of its flagship One X smartphone, the device could not do much for the company.
HTC CEO Peter Chou last month announced the launch of other new models in the second half of this year. But, with Samsung Galaxy S3's skyrocketing sales figure and the colossal hype and expectation created over Apple's next generation iPhone, what HTC does to bounce back to the market, is something to look for in coming days.
