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HTC's Q4 forecast shows that the company is still bleeding money

Posted: , posted by Chris P.

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HTC's Q4 forecast shows that the company is still bleeding money
The story of HTC is really beginning to scare us a bit, due to the parallels our minds instinctively draw. A company of zero repute in the distant 1997, HTC became one of the biggest (contract) manufacturers in the world, but today, it's on its way to a post a second consecutive disappointing showing in Q4. In its 16 year history, HTC has only ever posted a loss once before.

These news come directly from HTC's financial forecasts for Q4. According to the Taiwanese maker, their revenue is projected to be between $1.4 and $1.5 billion. That's below analysts' estimated average of about $1.8 billion, a number compiled by Bloomberg. It would, therefore, appear that HTC's efforts in cutting expenses, enlisting some marketing help, along with the latest entries to its portfolio are unable to drive demand for the company's wares. HTC's sale of its 25% (about $860 million, pre-tax) share in Beats Electronics, also appears incapable of stemming the tide of losses the company is making. Multiple sources have already reported that the Taiwanese manufacturer is working on a new portfolio of lower-end devices for the Chinese market that it hopes will rejuvenate its finances, but these are probably still a few months off.

HTC's stock declined sharply (as much as 7%) in the hours before the outlook was even announced, representing its biggest drop since October 2012.

This puts HTC in a real tough position, and the company's predicament sure reminds us of other recent stories, that read in much the same way. Nevertheless, we haven't given up on HTC just yet, and we sure hope that HTC hasn't given up on us, either.

Source: Bloomberg

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