HTC plummets after it cuts sales outlook
HTC, the world’s number four smartphone maker, warned it would see no revenue growth this quarter, in a further sign that bigger rivals Apple and Samsung are stealing sales.
The Taiwanese company, which is valued at around $16bn (£10bn), had previously forecast fourth-quarter revenue would grow 20-30 per cent from a year ago.
The surprise cut sent HTC shares tumbling seven per cent on yesterday to their lowest in around 16 months.
Analysts, several of whom downgraded the stock and cut their share price targets, said HTC did not have enough new product ramp-ups to offset the loss of market share in the US and Europe to Apple and Samsung Electronics.
“In terms of content, HTC is incomparable to Apple; in terms of performance and price, HTC is also no better than Samsung,” said Yuanta analyst Vincent Chen, noting HTC’s disappointing sale of high-end phones in the US, a market that accounts for around half its revenue.
Citi analyst Kevin Chang wrote in a client report that HTC could have better products from the second quarter of next year, but warned it can prove a long road to recovery for handset makers, citing the example of Nokia, once they start missing product cycles and guidance.
Sanford Bernstein analyst Pierre Ferragu said HTC’s revised guidance came as a surprise, and was “at odds with recent discussions we have had with distribution channels, especially in Europe”.