HTC coming out of the doldrums: forecasts Q2 profit and doubling the revenue
HTC just issued its usual quarterly report forecast, and it seems to be coming out of the revenue and profit slumps that could be observed in recent quarters. The company predicts doubling its revenue now, and returning to profit in the current quarter that ends up in June.
source: WSJ (paywall)
Revenue in the second quarter is expected to fall a bit year-on-year, from 70.7 billion New Taiwan dollars, to between NT$65 billion (US$2.16 billion), and NT$70 billion. This means that the improvement compared to Q1 will be very be significant, though, more than doubling the puny NT$33.1 billion that HTC raked in the previous quarter. The gross margins are expected to scale back a bit from 23.2% a year earlier, to 21.3%-22.0% now, which can be expected, given the launch of new products like the flagship HTC One (M8).
It looks like HTC's turnaround strategy might be paying off. The company introduced new affordable entrants in the low- to mid-range realm, and doesn't have any supply issues with the One (M8), as it had last year with its predecessor. Moreover, Chairman Wang received a more active role in managing the daily operations of the company, and HTC is also prepping to outsource production for some of its handsets, which should further help lower costs. Given the rumors about an eventual top-shelf One (M8) Prime that is due in the fall, we are crossing fingers for HTC to overcome this period, and keep the competition on its toes, as we are all benefiting from stronger industry players, and more of them.
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