Share prices of HTC Corp (宏達電), Asia’s second-largest smartphone maker, fell the most in two months in Taipei trading after forecasting first-quarter revenues that missed analyst estimates as it faces tougher competition in the US.
HTC share prices dropped by its 6.9 percent daily limit, the most on an intraday basis since Dec. 5 last year, ending trading at NT$513.
Trading volume was double the three-month daily average. Sales this quarter will be NT$65 billion (US$2.2 billion) to NT$70 billion, the Taoyuan-based company said on Monday. That is the lowest since the second quarter of 2010 and below the NT$84.9 billion average of 14 analyst estimates.
Competition from Apple Inc’s iPhone and Samsung Electronics Co’s Galaxy models damped demand for HTC devices in the US, while sales of faster LTE fourth-generation models did not meet expectations, chief financial officer Winston Yung (容覺生) said on Monday.
New models will be released next quarter, prompting the weak guidance this period as the company awaits “product transition,” Yung said.
“HTC is likely to lose further economies of scale in manufacturing in 2012 and 2013, as we forecast its shipments for 2012 to decline further to one-third of those of Samsung and Apple, down from half for 2011,” Alex Chang, an analyst at Daiwa Capital Markets in Taipei, wrote in a report yesterday.
Daiwa downgraded the stock to “sell” from “hold” and lowered the six-month target price to NT$333.
HTC became the largest smartphone maker in the US during the third quarter as consumers awaited the next iPhone model, according to data from researcher Canalys. HTC cut its fourth-quarter sales outlook on Nov. 23 by more than 20 percent, citing competition from the iPhone 4S.
Thirteen of 35 analysts tracked by Bloomberg now recommend investors sell the stock, with eight saying “buy” and 14 advising to “hold.”
HTC will release new models at the Mobile World Congress to be held in Barcelona, Spain, beginning on Feb. 27, Yolanda Wang, a Taipei-based analyst at HSBC Holdings PLC, wrote in a report.
She maintained her “underweight” rating on the stock and cut her price estimate 6 percent to NT$386.
Share prices, which have risen 4 percent this year, dropped 42 percent last year and are down more than 58 percent from their peak in April last year.
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