By all accounts, HTC’s second fiscal quarter should be going superbly. It has the highly acclaimed VR headset, the Vive. It has the near universally praised 10. It has numerous phones to Desire. And yet…the only account which seems to be sorely lacking is the one marked “receivable”.
The OEM’s investor relations page has announced its revenue for May 2016 and it paints a painful picture for what was seemingly a perfectly poised point to profit from: despite releasing a host of new devices, HTC’s second quarter earnings are expected to be NT$6.75 billion, which converts to just over $200 million.
To be fair, the figure has a definitively different digit up front compared to the NT$5.7 billion HTC earned in the previous month for a 17.4% increase in revenue. On the other hand, it’s a 37.4% year-on-year decrease which is especially alarming given that last year saw the launch of the thoroughly panned HTC One M9.
Despite the extensive amount of praise the HTC 10 has received, it seems that the product simply can not manage to generate a considerable amount of revenue for its manufacturer. Indeed this conundrum was touched upon several days ago in our piece, “Have to Concede”.
The phenomenon is not unlike that which occurred last year with LG’s G4 wherein there was a large amount of positive press and publicity due to the fact the phone had a removable battery and microSD card support. Yet when push came to shove, LG was unable to translate that into tangible purchases.
It’s likely the same thing has occurred here, with Samsung’s Galaxy S7 and Galaxy S7 Edge handsets having been released for several months prior to HTC’s 10 hitting stores. The late launch of the product may have contributed to lost sales, as customers would have been presented with both Samsung’s handsets and LG’s G5, which also went on sale considerably earlier than the HTC 10.
Also worth considering: pricing. The Vive, while praised, is extremely expensive and requires a high end gaming rig to run. The 10 is also an expensive handset, on par with Samsung’s offering despite what some feel is a lower build quality and design.
Realistically speaking, it may very well be that HTC’s brand itself has become diluted. This is likely due to keen competition from rival products and manufacturers, as well as a significantly depreciated interest in the Taiwanese company’s products due to hardware which has consistently failed to capture the market’s mainstream focus for several years running.
This also represents, perhaps, a referendum on the company’s CEO, Cher Wang, who has clearly failed to turn around her company’s fading finances.
Given that HTC does not have any known halo product for the second half of the year, there is a seemingly significant slump that will occur going forward. There have been rumors of the OEM building a pair of Nexus devices this year – something that has become seemingly less solid now that Huawei has spilled the beans – however these glorified Google handsets have yet to ever be cited as having sold in numbers needed to chart in industry ranking lists.
While its possible there will be some more good news to be had after HTC releases the final results days or weeks later, at the moment it’s quite clear that the 10 has apparently failed to resonate with consumers around the globe.
What do you think? Does this less than stellar performance sadden your situation? Were you pining away hoping for HTC to return to its heyday? Leave a comment or two down below and share your thoughts.