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HTC is losing confidence, ditches forecasts as losses mount

HTC has posted another quarterly loss in Q3 2015 and has decided to stop publishing guidance on its future performance.

Published onOctober 30, 2015

htc one a9 review aa (8 of 29)

LG, Samsung and Sony have all recently opened up their books for Q3 2015, revealing that the big names in the Android mobile market are all struggling to shift high-end smartphones this year. HTC’s latest financial statement is perhaps the worst of the lot, as the company has posted yet another notable quarterly loss.

HTC has again seen a large decline in its revenue, falling from NT$33 billion (£1 billion) in Q2 to NT$21.4 billion ($660 million) in Q3. Q3 revenue in 2015 is roughly half the amount that HTCmanaged to generate at the same point last year. As a result, the company’s operating margin has fallen from -15.6 percent to -23.1 percent over the past quarter.

The company’s operating loss has remained more consistent from the previous quarter, improving ever so slightly from NT$5.1 billion ($157 million) to NT$4.9 billion ($151 million). However, HTCwas just about breaking even at this point last year. The graphs below sum up the bleak looking situation rather handily.

HTC Revenue and Profit Q3 2015

If the figures aren’t damning enough, HTChas also stopped publishing guidance on its future performance. In other words, HTCis no longer offering insight into how much profit or loss the company expects to make in the next quarter.

HTC clearly has some idea about how much money it expects to make or lose, so we can only assume that such figures wouldn’t make for pretty reading. HTCis likely to have abandoned publishing these figures out of fear for missing them, which is typically met with a swift blow to stock prices as investors sell up. Company valuation issues have hurt HTCa few times in the past, having seen the company dropped from the TWSE 50 Index and even leaving the brand worthless at one point.

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The company still has plenty of cash reserved to keep it in business, but successive quarterly losses are clearly showing their strain. HTCappears to have adjusted its mobile strategy lately, as shown by its growing selection of spin-off devices and the launch of the more unique HTCOne A9. The next quarter’s financial results will give us some insight into how much impact this device will have had on HTCgoing into 2016, which could be a decisive year.

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