TAIPEI Jan 6 Taiwanese smartphone maker HTC
reported a worse than expected net fourth-quarter
profit on Sunday, despite aggressive cost cutting and a
The company reported net profit of T$0.3 billion ($10
million), compared to a net loss of T$2.97 billion ($99.9
million) in the previous quarter and profit of T$1.01 billion
($34 million) in the same quarter of 2012.
The figure lags expected net profit of T$721.71 million
($24.3 million), according to Thomson Reuters I/B/E/S.
The number highlights how quickly problems have piled up at
a company that just over two years ago supplied one in every 10
smartphones sold around the world.
The company, which has lost nearly three-quarter of its
market value in the last two years, is now worth about $4
billion, dwarfed by rivals like Apple and Samsung
Electronics Co Ltd.
New management installed in the last quarter to tackle that
slide must persuade customers the brand can still stand for
stylish, feature-loaded phones, while keeping a lid on
Despite its latest flagship product, the HTC One, garnering
rave reviews, the company's global share of the smartphone
market has declined to a mere 2.2 percent in the third quarter
of 2013 from a peak of 10.3 percent in the third quarter of
2011, data from research firm Gartner show.
While the company's recent "Here's To Change" campaign has
seen an advertising revamp featuring "Iron Man" star Robert
Downey Jr., analysts remain skeptical about the firm's ability
to differentiate its brand image in a highly-saturated playing
The company has embarked on a cost-cutting campaign that
includes buying its chips from cheaper vendors and outsourcing
production. It also sold its stake in headphone brand Beats
Electronics LLC, booking a one-time pre-tax profit of T$2.5
billion ($85 million), which would be recorded in the fourth
Shuttered factories, a wave of executive departures and
top-level reshuffling are symptoms of what industry insiders see
as the company's biggest problem: connecting with consumers.