HTC

HTC net profit drops again in Q3 2012

HTC net profit drops again in Q3 2012
HTC keeps on sliding on the downward slope with net profits falling down 79% in Q3 2012 as its smartphones lose to rivals like iPhone and Samsung’s Galaxy S series.

HTC’s revenue in the third quarter amounted to around $2.4 billion (NT$70.2 billion), and income before taxes stood at some $137 million (NT$4 billion), declining nearly 50% from the $250 million the company earned in the preceding trimester.

In the third quarter, HTC relied mainly on its One lineup of Android phones, but it has recently unveiled the impressive HTC One X+ and two HTC Windows Phone 8 devices, that should help out pushing the company’s profits in the last quarter of the year. Do you think HTC will do well with its latest phones?

source: HTC via Reuters

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47 Comments

1. g2a5b0e unregistered

HTC loses even more money. There's a surprise. My suggestion: Stop making all your flagships exclusive to certain carriers. There's a reason why Samsung is raking in all the cash right now. HTC makes great phones, but people will never know if they aren't available to them.

20. darac

Posts: 2156; Member since: Oct 17, 2011

HTC isn't losing money yet, actually they are still piling it up just that their profits keep decreasing. If the trend continues then they could indeed start losing money but their cash reserves are left untouched until then.

28. g2a5b0e unregistered

I know they aren't technically "losing money". I just meant that if you're not making the most you can, then it can feel that way & HTC can & should be making a hellluva lot more.

30. neutralguy

Posts: 1152; Member since: Apr 30, 2012

It's hard to make bigger money if you focused on releasing high end, mid-range and lower mid-range products. Especially when the competition is tight and controlled by other companies. They should really need to re-consider entry level for emerging markets. That's how samsung made it anyways.

2. enemy_dil

Posts: 7; Member since: Oct 07, 2012

hope one X+ and 8 X and S same them HTC is one of the best around.

3. shandesilva

Posts: 105; Member since: Mar 28, 2012

htc make some great hardware. arguably better than samsung. but personally what i dont like are (surely most other consumers as well) the sense overlay, almost the same design without much change and poor battery life.

8. darkskoliro

Posts: 1092; Member since: May 07, 2012

you obviously dont know much about whats going on. 1) HTC dont make the hardware, they use NVIDIA's Tegra 3 2) I guess thats personal opinion but sense is the best out right now. 3) Their design is actually the best out there, including build quality. 4) and their battery life has been vastly improved though software, and now hardware (OneX+ got 2100mah) But nevertheless they are still losing profit. All the best to them

35. mozes316

Posts: 144; Member since: Sep 30, 2011

Just out of curiosity, what makes Sense better than Touch Wiz or any other UI overlay. I've used just about all of them and I like Sense but I can't say that it's the best.

45. lsutigers

Posts: 832; Member since: Mar 08, 2009

It's a matter of personal opinion, but generally speaking, most people prefer Sense over any other Android UI overlay, except vanilla (no UI overlay). Samsung's Touch Wiz and Moto's Blur (until they revamped it) are considered by many to be the least favorite. Many people say Touch Wiz is cartoony, too colorful and patchwork, while Sense is more polished / refined with a more professional look. Again, it is all personal preference.

47. cellphonator

Posts: 298; Member since: Oct 29, 2011

Totally agree.

4. darktranquillity

Posts: 285; Member since: Feb 28, 2012

Thanks to half baked flagships.

22. darac

Posts: 2156; Member since: Oct 17, 2011

I agree. I'm enjoying my new international S3 and i can see a great level of devotion and attention in the software package - something that One X lacked upon release. Things could change with the X+ though

5. gwuhua1984

Posts: 1237; Member since: Mar 06, 2012

Expected, good products with poor management.

6. SlimSoulja86

Posts: 660; Member since: Nov 03, 2011

I thought Sense was the best with HTC's good built quality with "some great hardware, arguably better than Samsung.", why arent people buying HTC devices instead of cheap plastic Samsung with less better hardware? Well I guess it's all about innovation hay

7. bayhuy

Posts: 320; Member since: Jun 23, 2011

More advertising, HTC! Flo Rida blowing the whistle with Lumia, James Bond with Sony, London Olympics with S3, 2/3 of the ads I see on TV are S3, without being the best device...

9. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

It's helpless for HTC and any other company except Samsung. This only proves the theory that sales on this magnitude have nothing to do with devices, technologies, product packaging, logistics or marketing, but with cultural signification. When certain brand is positively signified on mass scale, like Apple initially and now Samsung, it is based on sign itself, the "knowness" of a brand as a cultural sign. Samsung is a cultural sign that is associated with growing hatred towards Apple, and that's why it's succesful. HTC is not. So it cannot have this kind of sales. Because there is only place for two opposite ideologies. HTC is failing, and so it will Nokia and Windows, unless they take down one of previous two opposite sides in cultural significance. There can be only two of them. Of course, most people will argue that the reason for fall is something in category of brand, marketing, product, device, pricing, availability etc., but the true reason will always remain hidden unless they decide to see the problem from cultural perspective.

10. mobileharan

Posts: 18; Member since: Oct 31, 2011

Advertisements and Marketing are very important .. For example in my country India each and every individual knows the Galaxy S3 at least the Galaxy line .. But still many of them don't know what is One X .. And even few dont the company HTC itself ..

11. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

Those are not very important. In my country iPhone was never marketed. Never. Everybody knows they should have it. Now, the same is with Galaxy SIII. Marketing doesn't matter, only viral cultural information that flows through mass media, mostly internet, that gets spread by word of mouth. Something that's hard to engineer to any marketing expert.

15. mobileharan

Posts: 18; Member since: Oct 31, 2011

True ... I think the terms Iphone and Galaxy has become passion .. That's why they don't need much marketing ...Those passionate ones think iphones and for andriod Samsung galaxy phones are best no matter what other phone gives ... And they spread good messages about these phones and the phones becomes viral .. The other companies should try to get some passionate fans behind them ..

29. ph00ny

Posts: 1993; Member since: May 26, 2011

Brand recognition in overall sense is very important. That's why Apple iPhone and Samsung Galaxy lineups are so popular On the other hand, HTC One line just started. Let's hope that this becomes a three horse race

31. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

HTC One line has already failed.

46. lsutigers

Posts: 832; Member since: Mar 08, 2009

HTC, AT&T and Sprint have all done quite a bit of marketing of their flagship HTC products like the One X and EVO 4G LTE. I think alot has to do with exclusives as mentioned before, while the One X may have done well on AT&T, and the EVO LTE on Sprint, you cant support an entire company with 2 phones when you limit yourself to only 2 carriers. Verizon only has the Droid Incredible and T-Mobile has the One S, which are midrange devices, unlike the EVO and One X. Samsung's formula has worked, and for a reason, they offer their flagship devices on EVERY carrier and let the carriers have exclusives with midrange and entry level devices. The problem is that Samsung has now reached the level of success where they can tell the carriers what they will and wont do, HTC is not there yet, therefore, the carriers can still pressure them into making flagships exclusive.

12. cGmC11

Posts: 152; Member since: Apr 02, 2012

Definitely they need a Nexus phone rush!

13. darkyume

Posts: 7; Member since: Oct 08, 2012

For Apple and Samsung, their flagship phones are easy to understand to the regular consumer - the iPhone and Galaxy S series. HTC has had the Incredible, Thunderbolt, EVO, Rezound, One, Sensation (and much more I'm sure) as their flagship phone at one point or another, on different carriers. With so many "flagship" phones and variations, knowing about them and which carriers they're offered by, should be difficult even if you were to visit PhoneArena everyday. Not having a clear, common, universally recognizable flagship phone across all carriers, is killing their brand recognition. Personally, I think they churn out too many half-baked "flagships."

14. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

That's a good point but doesn't hold in this case. Having myriads of models that confuses potential buyers is certainly a bad strategy that is for some reason always used by most manufacturers except Apple (think of the Sony and at least 15 Xperia phones differentiated with alphabetic letters in last 6 months - no wonder they are losing money too!) However, Samung also has this kind of production. They actually have dozens of Galaxy branded phones among all others, and Galaxy S series is reincarnated numeorous times (Galaxy S+, Galaxy S Advance, Galaxy Nexus, Galaxy S Duo...). However, the sales are strong only for galaxy SII and SIII, because those are culturally recognized products, not because they are the only flagships.

18. darkyume

Posts: 7; Member since: Oct 08, 2012

> However, the sales are strong only for galaxy SII and SIII, because those are culturally recognized products I don't understand why my point doesn't hold - "culturally recognized products" is exactly what I meant by flagship phones that are easy to understand to the regular consumer. Admittedly, I don't think Samsung did a good job of this until the SII and SIII. However, it is rather clear by now that Samsung has two pillars in their S series and Note series (for mobile phones). All you have to do is ask yourself this - Which phone is _____ 's best phone? Here are my answers (and I visit PA everyday): Apple: iPhone 5 Samsung: SIII, Note II Motorola: one of the RAZRs (MAXX, with HD and M coming soon?) HTC: ...which carrier? I've heard of the One X+ from the One series, but didn't the Incredible 4G come out recently? Nokia: one of the Lumia's (I don't follow Nokia news and their model numbers very well)

19. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

Culturally recognized product is not neccessarily a flagship products in terms of wanting the best in hierarchy. It's just a product that has become cultural sign. For instance, Sony's Xperia S as a flagship didn't become cultural sign - it needs more than just be flagship device. Cultural signification constitutes itself in society that is identifying with subculture. There are two main subcultures now: Apple and Android/Samsung. The third one, Windows Phone is rising, but it's not found its true oppositional place yet. The symbol of Android subculture is Galaxy S series, most notably SII and now SIII. Note is also becoming this kind of symbol. But it doesn't have to do much with the fact those are flagship by stratification established by manufacturer itself, although it is more probable that precisely flagship will be signifed, but only because the current language of signifying is based on technical specification in quantitative sense. I will make my point again with example in my country: HTC has only One X in my country. It's still on a weak sales. On the other side, Galaxy SIII is selling like hot cakes. Not One X nor GSIII were substantially marketized, and for what they were, there was no difference between marketing of the two!

26. darkyume

Posts: 7; Member since: Oct 08, 2012

Reading your other comments, what caught my attention was that you said marketing is insignificant. "iSheep", "dude, you're a barista," "the next big thing is already here," etc - this is all Samsung marketing, setting itself up to be the anti-Apple. The whole Apple vs. Samsung thing certainly did come from Samsung marketing. A lack of marketing in your country doesn't mean cultural significance came from nowhere at all. Anyways, my point was more about how brands need an identity, and not really whether they are culturally significant. Apple (iPhone), Samsung (S, Note), Motorola (RAZR on Verizon), Nokia (Lumia) has one. HTC doesn't.

32. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

The lines you quoted is not Samsung's marketing. Samsung has just took over the already growing cultural trend. Concept of iSomething and Apple customers' ignorance was developed cultorologicaly as a strong sign, and Samsung merely used it for later marketing, that marketing which was already put in the final stage of Samsung's success. Samsung is identified as an opposition to long before Samsung used it as their marketing value. They were associated with opposition to iPhone ever since F700, with culmination in galaxy S. They've introduced "iSomething" marketing campaign only with Galaxy SII, but to the full extent their signification found fertile gorund only during last year, more thankfully to the perceived failure of iPhone 5 than to the Galaxy SIII superiority alone. BTW Nokia is doing very bad with it's flagships - and they have two of them! Motorola is seeing losses, just like Sony. Basically all manufacturers are losing their gorund except Samsung and LG. I still think this has nothing to do with marketing by itself. Of course, you need marketing, but only as a fundamental material, and the true success is dependent only upon cultural dynamics. For instance, some less known and badly designed products of Samsung in terms of market (niche producst) like Galaxy Note (that aims at eccentric population) have gained greater success than Nokia with it's ultra-expensive and globally systematic marketing campaign with Lumias. Also, Galaxy SIII gained more success based on its sole fact that it is the main iPhone rival for this year than Samsung's previous products under the most expensive mobile marketing campaign in history, the London 2012 Olympics, which were based on Galaxy Note, that even gained greater success by the same reasons, and not reasons of marketing. HTC One series is perfectly designed in terms of aimed markets. It could be easily seen that there were briliant experts working on a campaign. But there are no sales despite the fact that One X was considered flagship second only to Galaxy SIII but with a few months of advantagre, and it didn't even make profits during those months when One X was practically the best Android out there. And this is only a continuation of previous HTC's steep fall on market, that nobody truly understands. Why? Because everyone thinks it's all about marketing. But it's not.

41. darkyume

Posts: 7; Member since: Oct 08, 2012

I actually do like your comment and agree that the anti-Apple sentiment and rivalry existed to some degree before the SII. However, I do not believe that most general consumers would've been able to identify Samsung as either of those before the SII. The SII was a turning point in which Samsung strongly established their position as a rival (Apple vs. Samsung as opposed to iPhone vs Android), to the general people. Samsung certainly seized the opportunity by taking advantage of the "cultural significance" you are talking about. However, this was largely driven through marketing (relentlessly attacking Apple), creating solid products (SII/SIII), and establishing their identity as "the rival" to Apple. Without the marketing and solid product, Samsung would have never experienced the ascension it experienced with the SII/SIII. Also, I do agree that the One series was nicely designed. I believe that design is actually one of HTC's stronger suits, I personally thought it was a step in the right direction. However,

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