HTC posts lowest profit since 2004
HTC, Asia's second-largest smartphone maker, posted its lowest profit in eight years as a lack of new models prompted a loss of market share.
Fourth-quarter net income was NT$1 billion (€26 million), the Taiwan-based company said in a statement today.
That's the lowest since 2004 and less than the NT$10.9 billion it posted a year earlier.
Apple's iPhone 5 and new Galaxy models from Samsung drew market share away from HTC which lacked new offerings for most of the quarter.
Success of its Butterfly handset in Japan and expectations for a new device this quarter, codenamed M7, has driven the stock 48 per cent above a seven-year low reached in November.
"There were no strong products for HTC in the fourth quarter, so it will be the bottom of their sales and earnings," Richard Ko, an analyst at KGI Securities in Taipei who last week upgraded the stock to outperform from underperform, said before the announcement.
"New products such as Butterfly should start to have an effect on their results this quarter."
HTC on October 26 forecast sales of about NT$60 billion, the lowest in 11 quarters.
HTC climbed 0.35 per cent to close at NT$288 today in Taipei before the earnings announcement.
Fourth-quarter operating income was NT$600 million, HTC reported today, compared with the NT$1.11 billion average of 20 analyst estimates.
The company didn't provide details of any non-operating income earned during the period in its statement today.
Chief financial officer Chang Chialin on October 26 forecast an operating margin of 1 percent for the quarter, compared with 7 per cent in the prior period, as lower sales cut profitability.
Two weeks after that outlook was given, the company announced it had settled all patent cases with Apple and agreed to a licensing deal.
That pact would not have any adverse financial impact on the company, it said.