HTC posts yet another huge quarterly loss for Q3 2015

[StrangerGuy]

Source: http://www.androidauthority.com/htc-posts-loss-q3-2015-647063/

The Taiwan-based smartphone manufacturer has announced that its net loss for the three months ending on September 30th was NT$4.48 billion (~US$138 million). This is compared with a net profit of NT$0.6 billion a year earlier. HTC’s revenue has also dropped to just NT$21.4 billion (~US$658 million) from NT$41.9 billion (~US$1.29 billion) in the same period a year earlier.

Commoditization is here, and HTC is the worst positioned among them all of the OEMs: No component manufacturing or other viable business like Samsung/LG/Sony, and no control of their own OS, a superior supply chain and a world-class chip design house like Apple. Or outfits like Xiaomi who has much lower operating costs.

Also, I reckon the still terrible update model of Android is making consumers increasingly wary of sinking big money into flagship Android devices for fear of being abandoned by the phone vendor.

Even Samsung, the most profitable OEM, isn't spared from the Android money sucking pit: Samsung expected to post another disappointing profit in Q3 (2015)

If things are bad now, I bet 2016 is gonna hurt even more for everyone of them.

 

[Red Storm]

HTC got in on the game early on, and did great. Then at some point they kinda just stopped innovating and coasted. That predictably ended up costing them. And frankly I do not care about them, they are just a company that makes smartphones. If they don't keep pace with the times then they will fall and another will jump into their place to compete for our dollars. That's the good thing about having many different companies competing in the same space.

 

[dawheat]

I don't know if HTC would ever gain large market share, but it was their own missteps that brought them to this place. The M7 and M8 were reasonably well received and let them position themselves as the best designed Android phones.

- Horrible advertising campaign - no idea what the huge investment in RDJ got them
- M9 became stale with nothing to differentiate itself (stereo speakers were available via Moto, Sony, and other phones). Even if the internals were nothing special, they absolutely needed a fresh design to keep their mindshare as the design leader.

Once they lost that, there was literally nothing unique about their devices.

 

[Dulanic]

Someone doesn't even attempt to hide their bias here. There is a reason both companies profits have faltered and it has nothing to do /w Android. It is allll based on dumb manufacturer decisions.

HTC has not pushed out a hit phone for quite some time. That's 100% on them. Samsung also has faltered as there is less and less reason to update phones right now. I've owned a SGS1, 2, 4 and a note 4. Samsung used to have good reasons to update, but there is little reason for me to "downgrade" from my Note 4 IMO. They took out SD & removable batteries which I think hurt them. LG sure stole a lot of their old users though in the past couple years.

And based on those 2 manufacturers... I doubt my next phone will be a Samsung or a HTC, but it will be a android. My wife did just upgrade and she went with the G4 over the Samsung after owning 3 Samsung's herself also.

 

[itpromike]

This is really disappointing as I really LOVE HTC. They are one of the original players in the smartphone game who understood design and slick UI. But unfortunately the times caught up with them. I'm not sure if it's possible for them to come back - I think at this point they could get bought or maybe even SHOULD get bought by a company with deeper pockets to invest in moving their design language forward.

 

[poofyhairguy]

And frankly I do not care about them

I do a little bit, they innovated in the space in the right ways IMHO. They were the first to LTE, the first to 720p screens, and their skin was the first one to not suck. Back in 2013 while Samsung was trying to innovate with crappy software tricks like the auto scrolling thing, HTC was pushing real innovations that stuck elsewhere with the M7:

-An aluminum body and Android, copied by Samsung in 2015

-OIS and emphasis on low light performance, copied by everyone today

-Zoe and its concept of moving pictures, which is THE killer app for 3D Touch on the iPhone for less technical people.

-Front facing speakers, as seen on many phones including the Nexuses today

Outside of innovation, HTC also has been much better than Samsung about letting people unlock bootloaders to ROM and root on carrier phones. It would be sad to lose a company like HTC from this space. With that said, HTC's struggles do show that going forward your ability to source parts matters as much to your success as an Android OEM as anything else.

M7 sales were held back by part shortages, and neither the M7 nor the M8 had Samsung-level cameras which really hurt the praise factor (the M8 with a S5 camera would have been hands down the best Android phone in 2014). Then we get to 2015 and they STILL can't source a good camera, and their dependency on Qualcomm SoCs forces them to roll out 810 clunkers.

Honestly I don't know what could have saved them, they had a real chicken and egg situation. Maybe put in a Intel SoC back in 2014 and use their muscle elsewhere in the supply chain? I don't know.

The future of Android belongs to companies that can make their own parts like SoCs, or who only sell to a class of consumer that cares about price more than specs.

 

[ChronoReverse]

-OIS and emphasis on low light performance, copied by everyone today

I'm zeroing on this one because it's pretty symbolic to me of how HTC made missteps.


The M7's camera was loudly talked about but delivered nothing better compared to its competitors.

First off, it didn't have OIS and that was pioneered by Nokia anyway. Which comes to the second part where it didn't actually deliver better performance compared to its rivals. Regular light photos are obviously nowhere near as good so there's only low-light photos where it turns out it's not terribly better than even the GS4's poor night mode and worse than OIS equipped Nokia 920.


The point is that HTC got a lot of kudos for one reason or another but it really was never that much more compelling if at all. LG has turned out pretty well since 2013's excellent G2 and deserves to do better than HTC for instance.

 

[thilanliyan]

Really liked my M7. They really needed a homerun with the M9 and it wasn't one IMO.

 

[Mopetar]

I do a little bit, they innovated in the space in the right ways IMHO. They were the first to LTE, the first to 720p screens, and their skin was the first one to not suck. Back in 2013 while Samsung was trying to innovate with crappy software tricks like the auto scrolling thing, HTC was pushing real innovations that stuck elsewhere with the M7:

-An aluminum body and Android, copied by Samsung in 2015

-OIS and emphasis on low light performance, copied by everyone today

-Zoe and its concept of moving pictures, which is THE killer app for 3D Touch on the iPhone for less technical people.

-Front facing speakers, as seen on many phones including the Nexuses today

I guess they were too quiet with their brilliance.

 

[openwheel]

David can't beat Goliath every time. I hope they survive long enough for a big turn around. They have made some great phones, but Apple and Galaxy are too tempting for most people.

 

[gotsmack]

yea, they just aren't innovating enough and removed key features like sd card and removable battery. I can live without a sd card slot, but don't want to give up the removable battery.

Here is the thing, if you're going to remove distinguishing features and try to be like the iPhone, why don't I just get the iPhone or the closest Android equivalent?

 

[pm]

Well, I think the whole HTC Vive thing is going to kick butt and sell well for what it is, so next year should do a bit better for them - provided they can keep their margins up. I plan on getting one as soon as it goes on sale.

 

[holden j caufield]

I don't really care about the looks of the phone as they m7 design looks good to me but the m8 and m9 look the same. The masses probably need something different each year.

 

[poofyhairguy]

Well, I think the whole HTC Vive thing is going to kick butt and sell well for what it is, so next year should do a bit better for them - provided they can keep their margins up. I plan on getting one as soon as it goes on sale.

Yeah many people have said it is maybe the best VR device that will be on the market. I personally will be a late adopter for VR (unless the Galaxy VR goes on a Black Friday sale) but I hope it saves HTC.

 

[Oyeve]

The smart device market has too many options and the average consumer doesnt really care about tech. Average consumers get too confused when there are more than 2 or 3 options. Right now its pretty much iphone and android and when MOST consumers think android they are really thinking Samsung. Gone are the days when consumers think of Motorola let alone HTC.

 

[pete6032]

I bet most people in the US could only name 3 phone makers. Apple, Samsung, and maybe LG or BlackBerry. About 90% of the phones I see on the subway these days are Galaxy or iPhone. Sometimes I see HTC Ones, but I wonder if they just stick out more because of their design. Occasionally you see an old blackberry.