HTC Corp. Reports Weaker Q2 Numbers on Tough Competition, Litigation (AAPL) (GOOG)
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BUY (= Flat)
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HTC Corp. keeps seeing sales slip away. Does it mean the smartphone market has been saturated?
According to numbers from the Company released earlier, HTC saw a 57.8 percent drop in sales for its second-quarter, to NT$91.0 billion (about $3.04 billion). Further, net income slipped from $585.95 million last year to $247.5 million, though the number was up from $149.5 million in the first quarter.
HTC was expecting second-quarter revenue to hit NT$105 billion, according to prior reports.
Most of the gains were made following the introduction of the One range of smartphones. However, recent litigation with Apple (Nasdaq: AAPL) saw some U.S. shipments of the One X and Evo 4G delayed in May.
HTC saw most of its gains over the last few years from utilization of Google's (Nasdaq: GOOG) Android mobile operating system. With more and more competitors entering the market and producing higher-quality devices, it might have seemed only a matter of time before rapid revenue growth at the company would have ebbed.
As for the rest of the market, smartphone sales are still strong and expected to get stronger. Recent IDC data has about 398 million smartphones being shipped globally in the first-quarter of 2012, with about half of all Americans now smartphone users.
Whether or not OEMs like HTC, Research In Motion (Nasdaq: RIMM), and Nokia (NYSE: NOK) will be able to put together attractive-enough offerings to draw in buyers, or if Android will still continue to be the dominant player in the smartphone realm is a great set of questions. Microsoft's (Nasdaq: MSFT) bid to gain share with its Windows Phone 8 might draw in a few more distributors (Nokia is a main player here), while Apple's iOS 6 and upcoming iPhone 5 (tentative name) will also reinforce its spot atop the list of smartphone juggernauts.
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According to numbers from the Company released earlier, HTC saw a 57.8 percent drop in sales for its second-quarter, to NT$91.0 billion (about $3.04 billion). Further, net income slipped from $585.95 million last year to $247.5 million, though the number was up from $149.5 million in the first quarter.
HTC was expecting second-quarter revenue to hit NT$105 billion, according to prior reports.
Most of the gains were made following the introduction of the One range of smartphones. However, recent litigation with Apple (Nasdaq: AAPL) saw some U.S. shipments of the One X and Evo 4G delayed in May.
HTC saw most of its gains over the last few years from utilization of Google's (Nasdaq: GOOG) Android mobile operating system. With more and more competitors entering the market and producing higher-quality devices, it might have seemed only a matter of time before rapid revenue growth at the company would have ebbed.
As for the rest of the market, smartphone sales are still strong and expected to get stronger. Recent IDC data has about 398 million smartphones being shipped globally in the first-quarter of 2012, with about half of all Americans now smartphone users.
Whether or not OEMs like HTC, Research In Motion (Nasdaq: RIMM), and Nokia (NYSE: NOK) will be able to put together attractive-enough offerings to draw in buyers, or if Android will still continue to be the dominant player in the smartphone realm is a great set of questions. Microsoft's (Nasdaq: MSFT) bid to gain share with its Windows Phone 8 might draw in a few more distributors (Nokia is a main player here), while Apple's iOS 6 and upcoming iPhone 5 (tentative name) will also reinforce its spot atop the list of smartphone juggernauts.
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