HTC reported worse than expected results with losses of $62.06 million going into the first quarter of 2014.
The Taiwanese phone maker, one of the earliest entrants into the smartphone market with Google's Android software, has lost a lot of ground in the last two years to its biggest rivals Apple and Samsung. The struggling company posted Monday, unaudited net loss of 62.06 million (T$1.88 billion) in the first quarter due to ailing sales of the HTC One. The incurred losses are larger than expected by analysts, who put it at T$1.59 billion, reports Reuters.
The total revenue between January and March 2014 fell by more than a fifth since the previous quarter.
HTC, which was once the third biggest smartphone company after Samsung and Apple, now accounts for a mere 2 percent of the global smartphone market share. In 2011, the HTC smartphones accounted for more than 11 percent. The latest quarterly report is a sharp decline from previous year's same quarter, when HTC recorded T$85 million in profit. The revenue fell 22.6 percent over the three-month period ending March 2014, The Inquirer reports.
As for the smartphone's technical specifications and features, HTC One had a competitive edge compared to any other smartphone in the market. The former flagship also appeared in almost all top ten smartphone lists in 2013 and also won various awards. But still HTC failed to translate its strength into sales. The major drawback, Reuters reports, is its ineffective marketing compared to rivals, Samsung and Apple.
According to the CNET report, HTC spent 75.8 million on marketing in the U.S. last year, a fraction of Samsung's $363 million and Apple's $350.9 million spent in the United States. The first quarter results do not include the figures of HTC One M8, the company's latest flagship smartphone, and HTC Desire 816.
Market Analysts feel HTC has to work hard on turning around its branding and marketing strategies. Mark Stocker, a brand consultant based in Taiwan, in a statement to BBC said that HTC could learn some lessons from Apple .He said: "Mimic them, but figure out what your brand stands for. If Apple is Mercedes Benz, try to make yourself BMW."
The tech giant is hopeful that both handsets might somewhat turn the tide. Also HTC has been concentrating on high-e nd phones and has been losing out on the more popular lower and mid-segment market, which sells well in China. Companies like Lenova, ZTE and Huawei, all Chinese companies, are concentrating on that segment.
There are reports of internal trouble at the company and some senior level executives have departed. A top senior design executive was charged with theft of company secrets recently. He was trying to set up an independent company of his own, reports New York Times.
"The company expects to see positive trajectory of its revenue in April from March and forecasts quarter on quarter revenue growth in the second quarter," HTC said in a statement, Inquirer reports.
But analysts differ from HTC's high expectations. "The [HTC] M8 is good, but it's not as revolutionary as the previous flagship," Yuanta Securities analyst Dennis Chan told Reuters. "Everyone is watching the second quarter to see how it sells."
