Despite its weak earnings and sales in the fourth quarter, HTC said it expects to return to revenue growth in the first quarter thanks to the release of a new batch of smartphones. In a statement on its Web site, the company said it expects revenue of around $1 billion in the first quarter, up 7 percent from the year-ago period. However, HTC said gross profit margin will likely fall to 30 percent, down from 32 percent in the fourth quarter. Operating expenses are expected to remain flat at around 17 percent.
Earlier this month, HTC reported its fourth quarter results, with net profit dropping to $175.1 million, down 30 percent from $252.5 million in the year-ago quarter. Revenue in the fourth quarter dipped 13 percent. Many analysts said higher marketing costs cut into the company's profits in the quarter.
Going forward, HTC, which is the world's largest maker of phones running on Microsoft's Windows Mobile platform, said it expected to continue to be aggressive on both the Windows Mobile front and with Google's Android OS. T-Mobile USA is expected to launch the HD2, HTC's new flagship Windows Mobile device, later this spring. The phone features a 4.3-inch capacitive touchscreen display, 1 GHz Qualcomm Snapdragon processor and is the first Windows Mobile phone to feature HTC's Sense user interface.
The company also is hoping that the launch of the Nexus One, the phone it made in partnership with Google, will help increase Android adoption and drive momentum for the company. T-Mobile is the only carrier offering the device right now, but Verizon Wireless and Vodafone have also been announced as partners for the phone, which Google is selling through an online store.
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