Thu, Nov 05, 2009 - Page 12 News List

HTC chief executive forecasts stronger Q4

By Lisa Wang  /  STAFF REPORTER

HTC Corp (宏達電), maker of the world’s first Google phone, expects business to regain growth momentum in the current quarter amid signs of improving demand for its phones in developed countries like the US, a top executive said yesterday.

That may ease recent concern that intensifying competition may erode HTC’s market share and cause it to miss its full-year revenue target, which it trimmed in July.

“The fourth quarter will be a better period than the third quarter [by revenues and shipments],” HTC chief executive Peter Chou (周永明) told reporters on the sideline of a product launch.

“We are seeing some positive trends, though the emergence of new brands has increased market competition,” he said.

HTC, the world’s biggest maker of handsets running Microsoft Corp’s system, saw some bright spots such as the US and demand was quite good there, Chou said.

Roughly speaking, next year also looked good, he said, adding that the company would not alter its July forecast.

On July 31, HTC cut its revenue forecast for this year, blaming slow uptake of Google phones and weaker-than-expected demand in China.

Revenues were expected to slide by as much as 5 percent from last year’s NT$152.56 billion (US$4.69 billion), rather than a 10 percent annual growth forecast earlier, the company said.

“It may be difficult for HTC to achieve revenue guidance of NT$40 billion in the fourth quarter, since HTC doesn’t want to sacrifice pricing and margin,” said HSBC Securities analyst Christine Wang in a report issued last month.

“We believe that the selling price and margin needs to come down in order for the company to boost shipments and regain market share,” Wang said.

She gave an “underweight” rating on HTC.

HTC is expected to make NT$38.46 billion in the current quarter, up 13 percent from NT$34 billion made in the third quarter, Wang said.

Shipments may grow by 16 percent quarter-on-quarter in the October to December period, reversing a 7 percent decline in the third quarter.

Separately, Taiwan Mobile Co (台灣大哥大), the nation’s No. 2 telecom operator, will start selling HTC’s new phone — dubbed HD 2 — later this month.

The phone runs off Microsoft’s latest system and it was launched in Europe late last month by T-Mobile, O2, Orange and other wireless service providers.

HTC plans to launch the phone in the US in the first quarter of next year.

“The phone has been well received by our customers. We are unable to satisfy demand now,” Chou said.

HTC shares closed up 0.45 percent to NT$336.5 yesterday, compared to the TAIEX’s 1.97 percent gain.

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