Taiwan's Asustek Computer has not closed the door on the possibility of acquiring fellow Taiwanese smartphone maker HTC, which is struggling to revive its sales. However, it's unclear if Asustek would make a bid.
Asustek Chairman Johnny Shih made the comment in response to questions raised at the company's annual general meeting, CFO David Chang told Reuters. "Our chairman has chatted about the topic internally," Chang said. "Still, the chances of an actual takeover are not big as Asustek is a company that has depended on organic growth."
"We don't comment on rumor or speculation," HTC said in a statement to FierceWireless. "As an international brand, HTC will continue to design world-class innovative smart devices through its pursuit of brilliance brand promise."
HTC's shares dropped 20 percent on Monday and Tuesday combined after the company last week cut sales forecasts for the second quarter and predicted it would post a loss amid weaker sales for its high-end smartphones.
HTC said in a statement that it may incur a net loss of between $256 million (7.95 billion New Taiwan dollars) and $291 million for the second quarter. If HTC does post a net loss, it would break its streak of four straight quarters of steady if small profits. Recently, HTC has focused on selling mid-range phones in emerging markets and has slashed costs by outsourcing some of its manufacturing.
In a sign of how much sales of its new One M9 flagship smartphone may be struggling in the market, HTC said it now expects second-quarter sales of between $1.06 billion and $1.16 billion, down from a previous estimate in late April of $1.48 billion to $1.64 billion. HTC has been dinged for not doing enough to differentiate the One M9 from its predecessor from 2014, the One M8.
HTC also released the phone just as Samsung Electronics released its revamped Galaxy S6 and S6 Edge, which garnered strong reviews. Samsung also has a massively larger marketing budget than HTC, which, in a bid to set itself apart, announced it will offer a phone-replacement service to U.S. One M9 users at no additional cost.
According to the Taipei Times, HTC Chairwoman and CEO Cher Wang apologized for the company's performance at the firm's annual general meeting last week. "HTC's recent performance has let people down," Wang said at the meeting.
Wang said the company plans to launch a "hero product" in October, and make significant improvements in innovation and design for the next flagship model next year, the report said. Wang also added that HTC will improve its product mix strategy for smartphones.
- see this Reuters article
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