HTC see a slump in Android-based smartphones in 2011 fourth quarter

In 2008 HTC emerged as the first technology company to introduce Google, Inc.’s mobile operating system, Android OS.

However, the tables have been turned and HTC are no longer the alpha partners with Google. That position has been taken by Samsung. The Korean company joined hands with Google on various fronts.

However, of foremost importance is the Galaxy platform, a strategic alliance between Google and Samsung, where hardware will be Koreans’ and the software will be provided by the Wizards of the Silicon Valley.

The major concern for HTC at hand is the decreased sales in their Android-based smartphones. In this category, the company has multiple foes in the market like Apple, Samsung and Motorola.

HTC forecasted the sales for 2011 fourth-quarter to be in tune of around $4.3 Billion however; the latest statistics have proved that the company will not meet the target by miles. It is expected that the sales revenue of Q4 will fall in the neighbourhood
of $3 Billion.

In reply to these predictions, HTC said on their website:

“Due to global macro economic downturn and market competition, the assumptions of 2011 Q4 financial forecast provided earlier are no longer applicable. HTC expects 2011 Q4 revenue to be approximately the same as Q4 last year. Despite 2011 Q4 revenue is not
what we expected, HTC has strong confidence in its products and operation. We expect that growth will return in 2012 H1.”

The new line of HTC has not been successful for two reasons as described by Macquarie analyst Daniel Chang:

“We believe HTC needs to find a way to penetrate the mid- to low- end market and drive volume while regaining its technological leadership at the high end. Unfortunately, its peers adopted AMOLED and Android 4.0 OS earlier than HTC, and at the low end, HTC
is unwilling to be price aggressive due to a higher cost structure.”

In the wake of Chang’s predictions and suggestions, HTC made a move for S3 technology. The graphics company is now an HTC subsidiary.

However, HTC’s future success will closely be scouted in January’s Consumer Electronics Show (CES). The Taiwanese company is expected to put a new line of smartphones on display at CES.  

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Posted by Usman Khalid on Nov 24 2011. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry