Wed, May 10, 2017 - Page 12 News List

HTC quarterly loss slows after operational cost cuts

By Lauly Li  /  Staff reporter

HTC Corp (宏達電) yesterday reported a quarterly loss of NT$2 billion (US$66.1 million) for last quarter, saying that continued efforts to cut operating costs had helped ease the losses.

HTC lost NT$3.09 billion in the fourth quarter of last year and lost NT$2.61 billion in the first quarter of last year. The company has seen losses in each of the past eight quarters.

“HTC’s strategy of realigning resources and streamlining processes helped cut operating expenses by 20 percent last quarter” on a quarterly basis, the smartphone company said in a press release.

The company booked foreign-exchange gains of NT$88 million last quarter on proper hedging approaches, HTC said.

Gross margin climbed to 16.3 percent last quarter from the previous quarter’s 10.45 percent and 9.36 percent in the same period last year, marking the best figure in the past six quarters, HTC data showed.

Operating margin deteriorated to minus-16.2 percent last quarter, from minus-16.04 percent in the prior quarter.

However, that represented an improvement from minus-32.34 percent a year earlier, the data showed.

Negative operating margin suggests that HTC’s core business, smartphones, is still suffering, while its virtual reality business has yet to generate meaningful income, analysts said during a teleconference hosted by HTC.

HTC president of smartphones and connected devices Chang Chia-lin (張嘉臨) declined to set a timetable for when its smartphone business would swing back into profit.

Chang also declined to give a business outlook for the current quarter.

Chang said HTC has adjusted its smartphone strategy and planned to introduce five or six high-end flagship devices this year, scaling down from the company’s plan to offer six or seven models as it said it would in February.

“Our goal is to centralize company resources on a selected number of flagship models this year to secure HTC’s market position in the high-end segment,” Chang said.

He said HTC is to unveil a new flagship smartphone in Taiwan next week, which the company anticipates would lift the company’s operations.

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