HTC Corp (宏達電), the world’s largest maker of smartphones that use Microsoft Corp and Google Inc’s operating systems, posted record quarterly profits and revenue on the back of strong market demand.
Third-quarter net income climbed 95 percent to NT$11.1 billion (US$360 million) from NT$5.7 billion a year earlier and rose 29 percent from NT$8.6 billion in the second quarter.
Consolidated revenue more than doubled from last year to NT$76 billion in the third quarter and rose 24.6 percent from NT$61 billion in the second quarter. That beat the company’s July forecast for third-quarter revenue of NT$70 billion.
HTC’s third-quarter revenue was 9 percent lower than -Citigroup’s forecast, but its quarterly net income beat the brokerage’s estimate by about 2 percent, Citigroup analyst Kevin Chang (張凱偉) said in a client note yesterday.
Chang said HTC’s third-quarter earnings were slightly higher than his forecast because of higher-than--expected operating margin of 16.3 percent versus the company’s own guidance of 14.5 percent to 16 percent made in July.
“We reckon the [company’s] operating margin expansion was driven by operating leverage and further [product] mix improvement,” Chang said.
The company forecast in July that third-quarter smartphone shipments would hit 6.5 million units, compared with 5.4 million units in the second quarter.
Third-quarter shipment figures were not available in yesterday’s statement, but the company indicated in its news release that last month sales were “impacted by product transition with small initial shipments of new products, but volume shipment of new products will start from October.”
Looking ahead, analysts expected HTC’s recent new product launches, including T-Mobile G2, Desire HD, Desire Z and the upcoming new models for Windows Phone 7, to help boost performance from last month onward. Moreover, HTC is reportedly launching its iPad-like device in the first quarter next year.
Yuanta Securities Co (元大證券) expected HTC to ship 9 million units of handsets in the fourth quarter, while Steven Tseng (曾緒良), an analyst from RBS Asia Limited’s Taipei Branch, said in a report on Sept. 17 that he forecast a shipment of 8.3 million units for the quarter.
Yuanta predicted HTC to deliver revenue of about NT$98 billion in the period from this month to December, while other analysts expected an earnings per share of more than NT$17 in the quarter.
“However, it could be challenging for HTC to deliver upside to the fourth-quarter shipment expectation of 9.5 million-10 million units.”
Based on HTC’s third--quarter sales, Citigroup estimated the company shipped around 7 million units in the quarter. As such, it would need the company to deliver 40 percent quarter-on-quarter shipment growth in the final quarter to reach market expectations, he said.
See US on page 10
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure