HTC Corp’s (宏達電) change of chief executive officer should be a smooth transition and is expected to help the Taiwanese smartphone maker transform into a lifestyle brand, according to a foreign brokerage based in Japan.
HTC’s board of directors named chairwoman Cher Wang (王雪紅) as its new CEO on Friday, after it decided to move then-CEO Peter Chou (周永明) to a new role heading its Future Development Lab.
“In our view, this is important and proper step at this stage, as HTC is in the process of transitioning from a smartphone brand to a ‘lifestyle’ brand,” the Japanese brokerage wrote in a research note dated Friday.
INNOVATION
“Chou’s dedication to new product development is important to HTC’s future,” said the brokerage firm, whose name cannot be reported under rules set by Taiwan’s financial regulator, since the brokerage was offering specific forecasts that could influence the market.
In terms of its smartphone strategy, HTC would continue to push steady growth of its high-end models and seek to achieve higher overall volume by using various mid-to-lower end models to meet diverse market demand, the brokerage said.
The new management arrangement at HTC is likely to be “a smooth transition” and would better suit HTC’s long-term development plan, given Chou’s dedication to new technologies and product development, the brokerage said.
RED FLAG
It said that although it is pleased to see HTC’s strong commitment to non-smartphone products such as wearables, Internet of Things and virtual reality devices, the recent mixed consumer feedback on HTC’s new One M9 flagship phone might be cause for concern.
The company’s profitability might suffer in the short-term, given that high-end models remain its main profit drivers, the Japanese brokerage said.
The brokerage maintained its “neutral” rating on HTC shares and its price target of NT$172.
HTC shares rallied 1.77 percent to NT$144 in Taipei yesterday, outpacing the TAIEX, which gained 0.09 percent.
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