Struggling smartphone maker HTC eked out a net profit in its most recent quarter, but the company posted its second straight operating loss as higher production costs and falling sales pushed it into the red.
HTC reported a net profit of $10.34 million in the fourth quarter, compared to a profit of $34 million a year ago, missing the $23.14 million average of 20 analysts' estimates compiled by Bloomberg. HTC avoided a loss by selling its stake in Beats Electronics, booking a one-time pre-tax profit of $85 million in the process. HTC posted an operating loss of around $52 million in the quarter, which was narrower than the $116.7 million operating loss the company had in the third quarter.
The company failed to halt a nine-quarter decline in sales, and posted revenue of $1.43 billion, in line with the company's previous forecast for a range of $1.33 billion to $1.5 billion, and down from HTC's $1.56 billion in revenue in the third quarter.
HTC tried in 2013 to revive its sales around its flagship One smartphone and two variants, the One Mini and larger One Max. However, despite strong reviews for the One, HTC's sales have foundered amid intense competition and as the company has struggled with production issues. HTC brought in "Iron Man" star Robert Downey Jr. to serve as a pitchman and restore luster to the company's brand, but so far that campaign seems to have yielded few tangible results. The company is widely believed to be working on a successor to the One, currently codenamed the M8.
Meanwhile, HTC is continuing to try to turn the ship around. In December, HTC said that current CFO Chialin Chang will also serve as global head of sales for the time being. HTC said that Chang had been involved in sales before and the change is aimed at consolidating operations. Chang will also remain CFO "until the time a transition of responsibilities makes sense," the company said in a statement.
The company has gone through several months of executive reshufflings. In October, HTC Chairwoman and co-founder Cher Wang took over some of the day-to-day duties of CEO Peter Chou so he could focus more on products, in what was positioned as a temporary move to help the company turn around its fortunes.
- see this WSJ article (sub. req.)
- see this Bloomberg article
- see this Reuters article
- see this Re/code article
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