targets U.S. market share as new flagship sales outstrip predecessor
Send a link to a friend
[May 06, 2014]
By Michael Gold
— Taiwan's HTC Corp
said it is selling new flagship smartphone One M8 quicker than its
predecessor, and that the strong showing will help it claw back
market share in developed markets such as the U.S.
HTC's market share has steadily declined since the company briefly
topped the smartphone market in 2011, exacerbated by sales of
previous flagship One M7 failing to match the phone's critical
HTC is keen to avoid a similar outcome this year by accompanying the
M8 upgrade with "more effective and efficient marketing," Chief
Financial Officer Chialin Chang said at HTC's quarterly investor
conference on Tuesday.
"In 2014, we intend to sell more units of the M8 than the M7, which
was already the best-selling model in HTC history."
Even so, HTC expects revenue to land in a range of T$65 billion
($2.16 billion) to T$70 billion in April-June, slightly below the
T$71 billion of the same period a year earlier.
That would nevertheless be about double the T$33 billion booked in
January-March, when HTC reported a net loss that was wider than
analysts estimated at T$1.88 billion.
The first quarter finished in March with HTC ending 28 months of
on-year sales declines. HTC logged another sales rise in April
indicating strong shipments of the M8, which was released in late
March around a year after the M7.
HTC shipped 3.4 million M7 handsets in the second quarter of last
year compared with expectations of nearly twice that amount,
estimated Yuanta Securities analyst Dennis Chan.
Sales of the M8 have exceeded M7 sales in the same time frame, Chang
said on Tuesday, without providing figures. Chang also said HTC is
likely to break even or book a profit for the first half of the
Shares of HTC closed up 3.6 percent ahead of the briefing, reaching
a nine-month high on expectations of a strong revenue forecast. The
benchmark Taiwan SE Weighted Index ended up 0.5 percent.
HTC's future is not as dependent on its flagship model in advanced
markets as it once was, as sales of lower-priced models in emerging
economies are growing at an increasing rate.
[to top of second column]
The high-end market is slowing from its peak of just a few years ago
when HTC, as a relative unknown, pitted itself against established
consumer technology companies such as Apple Inc.
"If you want to grow share as a vendor it is hard to do so if you
just rely on one model that costs over $600," as Apple did until
recently with its iPhone, said Gartner principal analyst Annette
Addressing that sentiment, Chang said HTC will "dominate the
mid-tier" and "participate in the affordable segment", which he
defined as prices in a range of $150 to $200.
The smartphone market is likely to grow 19 percent this year from 39
percent in 2013, showed data from researcher IDC, threatening
prospects for all stakeholders from leading vendor Samsung
Electronics Co Ltd to fast-rising entrants such as Huawei
Technologies Co Ltd. ($1 = 30.1040 Taiwan Dollars)
(Editing by Christopher Cushing)[© 2014 Thomson Reuters. All rights
Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.