A tale of two quarters: HTC and Samsung

by: Bogdan PetrovanOctober 4, 2013

samsung galaxy s4 vs htc one backs aa

By coincidence, two of the most emblematic Android manufacturers released financial results at the same time today, highlighting the massive difference between the extreme points of the Android landscape.

In one corner, Samsung just provided guidance for its third quarter, and it looks that, despite rumors of slowdown, the Korean giant is in for another record quarter. Samsung expects to rake in $9.4 billion in operating profit, an impressive 25 percent more than the same quarter last year. If the guidance proves accurate, Samsung is going to accrue revenue of $54 billion in sales this quarter. For comparison, last quarter Samsung took home $8.5 billion in operating profit and recorded $51 billion in revenue.

In September, Samsung released the Galaxy Note 3 to good reviews, though the launch hasn’t been without controversy. Still, there’s no sign that consumers are losing interest in Samsung’s high-end devices, and, with a curved screen phone coming next week, the Korean company isn’t slowing down just yet.

And then, there’s the troubled HTC, which announced its first quarterly loss since it became a publicly traded company in 2002. As expected, HTC registered a net loss of $101 million, at a dismal revenue of $1.6 billion. Year on year, revenue dropped 33 percent, reflecting HTC’s poor sales and lack of competitiveness over the past months.

HTC isn’t the first or the last mobile manufacturer to register a loss, but, unlike many of its competitors, the company doesn’t have other activities to make up for the slump in mobile revenue. The sale of the stake in Beats Electronics and, hopefully, a successful launch of the One Max may help HTC end the year in the black.

  • frhow

    It should also be noted that their numbers are for all consumer electronics not just the smartphone avenue. Samsung has their hands in anything that deals with electronics from smartphones to tvs etc. So we are not technically speaking comparing apples to apples here, just a food for thought. Although I am sure in the smartphone sector they probably also saw a significant growth in operating profit as well.

    • frankie

      its the televisions that have plateaued not the phones, they are projected to have sold even more phones than q2

      • frhow

        I’m not talking about sales which are increasing, I’m talking about operating profit for the mobile sector. When you factor in the increase budget for marketing among other expenses makes while sales are up the expenses are also up thus plateauing the operating profit not sales.

  • Lee

    Mostly because of the somehow failed #HTCChange campaign in which they showered millions on RDJ.

    • Amine Elouakil

      Nope, because the commercial compaign just started, it’s a long term plan, the issue is they’ve should have done such ads 2 years ago and not just now, Things will get better by the time of the release of the next flagship (the succesor of the One) (better doesn’t mean they’ll come back to the stats they were at before) but they should keep their effort now to clease their brand name and advertize it to reach more people.

      As for numbers, there are two factors here : Margings, and sales numbers
      HTC Has neither or rather while the sales numbers are fair enough (revenue for the last 3 Quarter) the profit is low, which means the Marging are low (building a quality product and selling the same price as the plastic competitor is not an easy task) Samsung having both, not to mention that Samsung numbers does NOT represent phones sales but their wholes electronics division.

      • Oli72

        Totally agree. If HTC did this 2-3 years ago. They would be one of the top phones across the board like Sony LG Motorola.

      • frankie

        except that you know mobile brings in 2/3 of the profits

        • Amine Elouakil

          Source? also I see that you are carefully choosing your words : Mobile instead of smartphones, also notice that I didn’t take the merit of their phone division, just saying tha Samsung electronics profit =/= Profit from phones sales

      • nebsif

        I can already see this, even bigger bezels, smaller screen, and ofc no removable battery + no mSD slot, but – it will be made of some unibody leet high-grade satelite metal and pity apple fanboi sites like TheVerge will praise it like the best android smartphone ever made!

        Srsly what did they expect releasing a device bigger than last years flagship with same display size.

        • Amine Elouakil

          Ergonomics =/= small bezels, also the One bezels are fine and not a single user that have the phone complain about them, it’s only a very small minority fanboys of other brands such as you that complain about it. Smaller screen? since when do you decide for people what is small and what is not, 4.7″ is fine with me I don’t need 5.7″ bullshit. Non removable battery and no mSD this is a point that’s been discussed a million times : The vaste majority of customers DON’T care about it as long as there is a respectable of internal storage, and the One comes with a minimum 32gb unlike some other cheap plastic alternatives.
          As for the One reviews, the vast majority of tech websites from specialists like Anandtech to the more open to public sites like T3 agrees that the One is the best android phone and that’s not because of it metal body but as a whole package.

          And seriously would like to explaine why a phone should be smaller than last year flagship? I am happy with a device that includes some usefull innovations such as a dual front facing stereo speakers or a wide lens front facing camera than having a big physical button in the middle of the buttom of my screen.

  • Bone

    Nobody’s going to buy the One Max over the Note 3, nor should they do. There’s also the problem of the new-flaghship-every-4-months (plus naming confusion), HTC One X, One X+, Butterfly/DNA, One (huh?), Butterfly S, Butterfly 2…

    What will be the next? One +? One S? One 2? One Butterfly? HTC Two? Sounds a bit cheap.

    • Amine Elouakil

      There is no such thing, as alot of the products you mentioned are market specific and not launched globaly

      Global flagships are One X (refreshed to One X+)/ to the One .
      Can you buy a the Butterfly or any of it variants at your local carriers as you can with the One?

      Also please, Samsung release 54x times (ok I m exagerating but I’m not that from it) more variants of their phones than HTC Does do you want me to list how many variants there are the Galaxy Series alone?

      • Josh McMurdo

        you can it was re-branded as the dna on Verizon, but same phone.

        • Amine Elouakil

          Well no, as proven by your comment, is a carrier AND region specific phone,in comparaison You can find the One at Verizon, TMo, ATT, Sprint, and regional carriers in the US

          • Josh McMurdo

            the dna is on Verizon which by my accounts is a NATIONAL carrier in the US. The International version of this phone is the Butterfly. This was never region locked, to say the south east us only. A person in Seatle and Atlanta can go to a Verizon store and get the dna. US Cellular is a regional carrier. Verizon is not

    • Balraj

      Don’t say “nobody” lol
      It’s silly

    • weed

      The region lock is reason enough to get any phone over the Note 3.

  • cycad007

    Ways to improve HTC…
    1. Start listening to your users (removable battery & SD slot)
    2. Keep support (Android updates) for your old devices for 2 years minimum
    3. Remove Peter Chou
    4. Stop using Samsung components (yeah…they may be cheaper…but stop, you’re only hurting yourselves in the long wrong)

    • Nono

      You forgot these:
      – Upgradable battery (aftermaket batteries are huge with accessory makers)
      – Expandable storage on ALL your phones. This is HUGE outside the US, and everyone should know and expect all their phones to have it, else Samsung phones will always win by default.

  • Terry

    Like cycad007 said – Listen to your (ex) customers (I am one). The HTC One design is an abject failure in the marketplace. If you deny that then we have no common ground for a rational discussion.

    Advertising SOMETIMES can make the market love a bad product but not with a year of hate behind it. I don’t know when the One came out or what the various flavors are – I flat don’t care. If HTC wants to build a phone like the Sensation with a 5″ screen, an S800 and all the rest then I’ll look at them again. But as long as the hardware is any variation on the “One” I’ll just troll the occasional story about their red ink.

  • asian101

    As much as I would want for HTC to succeed, the dismal sales may probably be what the doctor ordered. They should deeply ponder what is wrong with their strategy. Good reviews to the latest flagship are not enough- remember the original Galaxy Note? It was the laughing stock of most tech sites, and I laughed at it telling myself Samsung has hit rock bottom in terms of crazy innovations. Lo and behold, it proved to be succesful. This proves that consumers mostly don’t care about expert reviews, as the consumers tend to either go for the “experience” and brand recognition (Apple) or for the “complete package” (Samsung for Android). And also do note that Sony has been doing well for the past quarters, though their phones were not generally well-received. Sony basically concentrated on the design department (minimalist approach), plus adding a cool unique feature of being waterproof, and making the price competitive. HTC, I am still a fan- and probably it is best if you might actually listen to consumers, and that would not hurt (like LG). Good luck and wishing you a future turnaround success.

  • wat

    Maxx release date has been extended too long and lost my interest already

    • weed

      Thats true, the hype is already dead. Anyway it doesnt have good enough camera, and the microSD card slot in leaked pics is 99% sure to be the China model.

  • weed

    So much for HTC One being so impressive. I said it a long time, One hasnt sold well at all, Samsung took its usual share of the high end segment with S4 as it did last year with S3. The difference this year is that Xperia Z captured the non-Samsung buying customers. In 2012 HTC had the number 2 best selling flagship, as Sony didnt have any good high end models in 2012, very different this year.

    Thanks to Sony for putting HTC out of their misery, screwed HTC buyers can at last have some redemption. HTCs slogan should be Bite The Pillow Im Coming In Dry.

    • .o._

      Trying to imagine the end of an htc TV commercial where screen fades to black, then in white letters your slogan appears.

      Hmm…I’ll have to think about that one a bit more.

  • kaleid

    HTC need to learn from Samsung, if they want to regain their success.

    For a start,
    try to listen to your loyal customer, HTC. Don’t be so arrogant like apple.

  • Vchamp2k

    Htc one is the best looking smartphone. But i did not like the screen unresponsiveness.

    • Amine Elouakil

      O.o change your device there must be an issue there