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HTC has become the latest big tech firm to share its financial results – and they make for quite grim reading for the Taiwanese firm.
Revenue was down, and the hardware manufacturer also reported an operating loss of 252 million US dollars (£162 million) for the quarter with senior executives even admitting during a conference call after the announcement that they don’t expect things to get much better in the near future.
In an interesting step, HTC financial chief Chailin Chang said they’d found that consumers want a “more fashionable phone” than those which HTC offers. The last two flagship devices – the M8 and this year’s M9 – have been aesthetically very similar, and the latter has struggled to sell compared with the iPhone 6, other Android devices and Chinese firms Huawei and Xiaomi gobbling up market share.
Chang said that to combat this, HTC will release a “classic version” of the flagship M9 before the end of the year, with the chief financial officer describing it as more “trendy”, and it will appear alongside other models with tweaked features – all of which will be aimed at markets below the flagship arena.
The official line was to “address premium segments”, but below the flagship level.
HTC said it is “rethinking the smartphone strategy”and will be looking to new markets – all of which points to a move away from just the premium, high-end phones that the M8 and M9 have been.
Somewhat ominously, the firm also said that the financial results meant that efficiency measures would have to be introduced to cut costs, and – though no details were provided – such talk is never good news.
On a more positive front, the HTC Vive virtual reality headset was earmarked as an area of potential future growth for the firm. The device is the product of a partnership with gaming giants Valve, and has attracted rave reviews from those who have used it so far.
It’s a bright spot that HTC need to keep shining as it works through a transitional period for its smartphones. The firm says expenses will come down significantly in 2016 once the cost-cutting measures have taken effect, but it’s not an ideal situation to be in – with attention needed on its devices that could help the balance sheet too.
Apple, Samsung and co aren’t slowing down either, with the latter set to unveil at least two new smartphones next week. HTC has its work cut out to stay in touch with their rivals – but at least their executives are willing to admit it. They say acceptance is always the hardest step.
