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Tech investment banking expertise to strengthen the unique value focus of growing the HTC brand and to achieve high growth again

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Updates #2:

–  HTC sees revenues down sharply on-year in July [DIGITIMES, Aug 7, 2012]

HTC saw its revenues dip 16.7% on month and 44.5% on year to a five-month low of NT$25 billion (US$834.45 million) in July. For the first seven months of 2012, revenues amounted to NT$183.9 billion, decreasing 32.8% from a year earlier, according to company filing with the Taiwan Stock Exchange (TSE).

… With HTC estimating its revenues to reach only NT$70-80 billion in the third quarter [US$2.3-2.7 billion], it is unlikely to see HTC’s revenues rebound to NT$30 billion in August and September, the Chinese-language Commercial Times said on August 7 report.

HTC sees fall in 3Q12 sales with lower margin [DIGITIMES, Aug 3, 2012] [US$3.5 billion]

HTC reported second-quarter consolidated revenues of NT$91.04 billion (US$3.04 billion), in line with its targeted NT$91 billion, which had been cut from its original target of NT$105 billion [US$3.5 billion]. Gross margin and operating margin for the second quarter came to 27.01% and 9%, respectively.

Second-quarter sales represented a 34.3% increase, but were 26.8% lower than those posted in the second quarter a year ago. Meanwhile, gross margin and operating margin showed improvement from the prior quarter, but decreases compared to the same period of 2011.

HTC generated net profits of NT$7.4 billion, or NT$8.90 a share, in the second quarter of 2012. Profits declined more than 50% from a year earlier, but rose over 60% on quarter.

HTC adjusts workforce [DIGITIMES, July 25, 2012]

HTC has been adjusting human resources in its production, R&D, and sales teams. Industry sources believe corporate restructuring is necessary as HTC’s sales have been declining.

Sales of the HTC One series have not been picking up due to tough competition in Europe and North America. HTC has been adjusting its global workforce by shutting down the R&D team in North Carolina, US, and offices in Brazil. Some members of the R&D team have been laid-off and there will be no renewals of contracts for 600 workers. The adjustments have impacted close to 1,000 staff.

Nokia, RIM and HTC to see smartphone shipments continue sliding in 2H12, say sources [DIGITIMES, July 9, 2012]

Nokia, RIM and HTC are expected to see their smartphone shipments, as well as market share, continue declining in the third and fourth quarters of 2012 due to a lag in migration to new platforms and weakening competitiveness of their products, according to industry sources.

Despite efforts initiated by Nokia, RIM and HTC to fend off competition from Apple and Samsung Electronics, RIM and HTC have reported lower than expected shipments for the second quarter of 2012, while Nokia is expected to see its second-quarter smartphone shipments drop below 10 million units, said the sources.

Although HTC managed to post a sequential gain in shipments in the second quarter, its second-quarter smartphone shipments barely reached nine million units, pointed out the sources.

HTC is expected to see its shipments stay flat or drop to eight million units in the third quarter and slip further to seven million in the fourth quarter, according to a Chinese-language Commercial Times report.

End of updates #2

Preliminary reading: HTC: the most promising ICT brand in Taiwan [Oct 18, 2010 – July 5, 2011; then with major updates on Feb 7, 2012

imageSource: HTC, Investor Relations

Updates #1: The MWC introduced HTC One series unveiled (for the first time) a proprietary HTC ImageChip image signal processor (thus not relying on ISPs coming with the Tegra 3 and Qualcomm S4 SoCs) in order to be able to take a shot “in just 0.7 seconds” and to have “a new superfast 0.2-seconds autofocus, continue to take nearly unlimited continuous shots“, as well as “capture a photo and shoot video at the same time” and be “also able to capture a photo frame from a previously recorded video.” (See also a detailed description of that inside of the so called HTC ImageSense feature set.) Such a hardware based differentiation approach will even be greater with HTC’s upcoming products according to the following news:

HTC plans to develop customized processors [DIGITIMES, April 24, 2012]

In order to have significant product differentiation, HTC plans to cooperate with Qualcomm, Nvidia and ST-Ericsson to develop and produce customized processors with specific functions for its smartphones, according to Taiwan-based handset chip designers.

HTC may develop specific functions for its smartphones and secure supply of customized processors, but it may run the risk of inventories because such processors are unlikely to be adopted by other vendors, the sources commented.

HTC plans to develop its own processor [China Times, April 23, 2012] with Google translation of the original in Chinese , or the same with Bing translation.The essential content of that was first reported by Unwired as: HTC is developing its own CPU for lower end smartphones with ST-Ericsson

HTC is following in the footsteps of Apple and Samsung, and is now working on its own dedicated applications processor. According to China Times, the Taiwanese smartphone maker has already signed memorandum of cooperation with ST-Ericsson to co-develop the chip.

Contrary to high performance Samsung and Apple CPUs which power their flagships, the new HTC processor will run the lower end smartphones. The devices with new chip will start shipping in volume sometime in 2013.

It seems that HTC is getting increasingly unhappy with Qualcomm, which powered most of HTC devices until this year. They have signaled their unhappiness in early February, and may even consider Qualcomm one of the reasons for the sales problems of the last few months.  HTC has already added NVIDIA to its application processor supplier list –quad core Tegra 3 is powering non U.S. version of the new One X flagship. But it has yet to diversify on the lower end.

Turning to ST-Ericsson and co-developing its own, cheaper CPU, may also be a way for HTC to start moving down market with lower priced devices. Up until now – HTC was mostly focused on a premium high-end smartphones, pretty much ignoring the low-end of the market. But as component prices get cheaper, and ever better quality Android devices are released at ever lower price points by Samsung, ZTE and Huawei – Taiwanese vendor has to find a way to respond.

And this move may be one of the responses.

 HTC, Facebook jointly developing smartphone, say sources [DIGITIMES, April 25, 2012]

Given that Google is expected to continue to cooperate with Samsung Electronics for the development of the next-generation Nexus smartphone, HTC reportedly has decided to move forward in its own way and is currently developing a customized smartphone in cooperation with Facebook slated to be launched in the third quarter of 2012 at the earliest, according to industry sources.

HTC had previously joined forces with Google to launch Google’s first own-brand smartphone, the Nexus One. However, Google then shifted to cooperating with Samsung as its primary production partner for the launch of its second and third own-brand smartphones.

Since Samsung has become the top vendor of Android smartphones, Google will continue to have Samsung develop its next-generation Nexus models, leveraging Samsung’s innovation ability with regard to the Android platform, and its ability to control the supply of key components, said sources.

The new Android smartphone being developed by HTC will have a platform exclusive to Facebook to enable and integrate all functions available on the social networking site, the sources indicated. Previously, HTC launched two Facebook-enabled smartphones, the Salsa and Chacha.

Facebook is expected to further expand its investments and sources of income after becoming a public company, and the launch of own-brand smartphones will be part of its development strategy, the sources commented.

End of updates #1

HTC personnel change indicates new value focus: Goldman Sachs [Focus Taiwan, Taiwan’s national news agency, April 17, 2012]

… The 45-year-old Chang, an investment banker and partner at Goldman Sachs before joining HTC, will be responsible for corporate finance and accounting, strategic acquisitions and investment, and investor relations.

“We believe the change in CFO may indicate HTC’s more aggressive attitude toward its finance department in terms of creating value other than just accounting integrity,” Goldman Sachs analyst Robert Yen wrote in a research note.

For example, he said, added value could mean enhancing “the uniqueness and competitiveness of HTC’s smartphone products and services.”

Given HTC’s many acquisitions and strategic investments in content and mobile services in the past and its decent cash position, it could be creating a different value by choosing a CFO with industry and banking background, Yen said. …

imageHTC Desire V for China Unicom (WCDMA)

Comparison [PDAdb.net]: HTC Desire VC T328d vs. HTC Desire V T328w vs. HTC Desire VT T328t [3]

Note: According to the detailed specifications given above these phones all have SLCD screens (see: Super LCD, Explained [DisplayBlog, Nov 24, 2011]), as on quite a number of higher end HTC smartphones in the last 2 years (since HTC Desire A8181 / HTC Bravo). Otherwise they have been using “transflective TFT LCD” mostly and in very few cases Super AMOLED.

HTC eyes cheaper smartphone market in China [Focus Taiwan, Taiwan’s national news agency, April 17, 2012]

Taiwan’s HTC Corp. launched several smartphones in China priced as low as 1,999 Chinese yuan (US$317) Tuesday in a bid to tap into the emerging mobile market.

The HTC launch in Beijing includes three smartphones in its customized New Desire series, which will go on sale from mid-April through three major Chinese telecom operators, according to a company statement.

The New Desire V, running on China Unicom’s 3G WCDMA network, will start from 1,999 Chinese yuan before subsidies, while the New Desire VC will support China Telecom’s CDMA 2000 frequency, for the same price tag.

Pricing for the New Desire VT, which will run on the country’s home-grown TD-SCDMA network provided by China Mobile, was not disclosed.

“The China market has always been a critical part of HTC’s global strategy. In addition to the HTC One series, we are introducing the New Desire series targeting Chinese consumers,” said Ray Yam, president of HTC’s China division.

“We believe HTC’s future is closely connected with China and that HTC will continue to bring the best experience and the most innovative smartphones to the country as soon as possible,” he added.

All the models in the New Desire series are equipped with a 4-inch display, a 1 GHz processor and a 5-megapixel camera, according to the company.

Separately, HTC said its new “One” family will also hit store shelves in China this month, with price tags ranging from 2,688 to 5,688 yuan.

The Taoyuan-based manufacturer is hoping that the streamlined models and an increased retail presence will help it boost its market share in China, which stood at only about 2 percent last year, according to analysts at Morgan Stanley.

HTC Desire VC for China Telecom (CDMA2000)

China market: HTC launches One, new Desire lineups [DIGITIMES, April 18, 2012]

… HTC currently accounts for a 10% share of smartphones sold with a price tag over CNY2,000 in China, but has not entered the mainstream sub-CNY1,000 segment, indicated the sources. …

HTC Prepares to Launch Lower-end “Kewang” Smartphones for China [IDG News, April 17, 2012]

… The HTC Kewang V, or Desire in English, will launch on April 23 through mobile operator China Unicom. … HTC’s goal with the Kewang series is to provide smartphones at a low price, but also with high-performance and strong features, said Ethan Qian, an HTC spokesman. The Kewang line is being released only in China, he added. …

HTC Desire VT for China Mobile (TD-SCDMA)

Dual card dual standby for only 1999 yuan HTC desire V officially released [China Tech News, April 17, 2012]

On the afternoon of April 16, China Unicom and HTC jointly held “China Unicom fertile 3G HTC new Desire V listed” conference, officially released the HTC new Desire V. It is customized by China Unicom, has 9.3mm ultra-thin body, support dual card dual standby, using clocked at 1GHz Qualcomm MSM 7227A processor [with Cortex-A5 single core, having 1.57 DMIPS/MHz performance, while Cortex-A8 has 2.0 DMIPS/MHz], 4 inches [Super LCD] screen with a resolution of 480×800 (WVGA). The phone will be powered by the Android 4.0 system, using the HTC Sense 4.0 UI, 5 megapixel camera with auto-focus, [512MB RAM] 4GB ROM, integrated Beats audio audio technology, the battery capacity of 1650 mA. Bare metal price of 1999 yuan is also a bright spot.

Super LCD vs Super AMOLED displays (HD) [TheTechTonicdotCom YouTube channel, Dec 11, 2011]

OK it’s time to get ultra geeky. This is a video comparison of the respective qualities of Super LCD and Super AMOLED displays. Famous for their true blacks and high contrast, how does a SAMOLED display fare against the warmer tones of SLCD? SLCD screen provided by the HTC Radar, at 480 x 800 resolution and 3.8 inches. SAMOLED screen provided by the Samsung Omnia 7 at the same resolution but at 4inches. More mobile tech content at http://www.thetechtonic.com Follow us on Twitter @the_tech_tonic
Note: Nokia has a superior technology for better brightness, contrast and outdoor visibility with a significant enhancement of both In-Plane Switching (IPS) type TFT and AMOLED display panels typically used. See: The leading ClearBlack display technology from Nokia [Dec 18, 2011 – Feb 2, 2012], especially for comparison with Super LCD of HTC Mozart (as well as with the Super AMOLED of Samsung Galaxy S II).

Commentary: HTC appoints new CFO, but challenges remain [DIGITIMES, April 17, 2012]

HTC has reshuffled its management team again by appointing former Goldman Sachs Group partner Chia-Lin Chang as its chief financial officer, which is part of the company’s strategy for global deployment.

The new appointment, which took effect on April 16, came after HTC announced earlier a 70% on-year decline in net profits for the first-quarter of 2012.

Perhaps, the new CFO could help the Taiwan-based smartphone vendor secure more acquisitions to strengthen its global deployment, but it remains to be seen whether HTC is able to regain its growth momentum in 2012 as it faces more challenges in integration of its corporate culture as well as increasing competition.

HTC has created or added a number of high-level positions since the second half of 2010, including the appointments of Ron Loukes as chief strategy officer and Kouji Kodera as chief product officer in July 2010, and Matthew Costello as COO in December 2010. HTC also appointed Jason Mackenzie as its president of global sales and marketing in July 2011.

HTC has also brought in Scott Croyle of One & Company and Shashi Fernando of Saffron Digital responsible for design and content, respectively, through acquisitions of the two companies.

It is also the second time in less than two years HTC has changed its CFO. The newly appointed CFO Chia-Lin Chang replaced Winston Yung, who took the post in January 2011.

If the latest management team is unable to bring back the growth momentum in 2012 that HTC enjoyed during the period from 2010-2011, HTC will no longer be able to compete with Samsung Electronics, Apple and even Huawei Device in terms of economies of scale in production.

While the hiring of talent with management and marketing expertise from abroad, and the acquisition of certain companies overseas are indeed necessary for HTC in its thrust to become a global brand, the impact resulting from the integration of corporate culture on HTC is expected to intensify along with such processes.

Given that nearly all top-rank positions with the exception of the CFO post at HTC have been filled with foreign executives, the promotion of local talent will likely become a major issue of concern in the future.

The Quietly Brilliant Story of HTC [HTC YouTube channel, Nov 23, 2011]

A short film about how the smartphone evolved – from some of the early pioneering handhelds to today’s most innovative smartphones.

HTC replaces CFO after just one year [15 1/2 months] on the job (update) [The Verge, April 17, 2012]

HTC has issued a statement on the transition:

On Monday, HTC announced the appointment of Chia-Lin Chang as Chief Financial Officer with Winston Yung, his predecessor, transitioning to a corporate development role.

“Media speculation that ties this announcement to HTC’s partnership and investment in Beats By Dre is categorically inaccurate,” said Peter Chou, CEO of HTC Corporation. “HTC and Beats have made impressive progress in innovation and brand awareness and the integration of the Beats brand and technology in the new HTC One series is a clear indication of our commitment to this partnership.”

Amazing camera, authentic sound, iconic design. HTC One has them all. [HTC YouTube channel, Feb 27, 2012]

Highlights of launch event in Barcelona on February 26, 2012 with Peter Chou, CEO and Scott Croyle, Vice President of Design.

HTC One series unveiled [from the 2012 HTC press releases or directly on the Canadian site]:

BARCELONA, SPAIN – Mobile World Congress – February 26, 2012 – HTC, a global designer of smartphones, today unveiled its new HTC One series of smartphones that represent its most premium mobile experience with a new level of iconic design and amazing camera and authentic sound experience. …

With HTC’s most premium experience, the HTC One series integrates Android 4.0 (ICS) with HTC Sense™ 4, the new version of HTC’s branded user experience that is introducing HTC ImageSense™, a new suite of camera and imaging features that set HTC One apart from other phones. HTC Sense 4 also includes broad enhancements to audio quality and simplifies how people listen to music on their phone.

Amazing Camera
With ImageSense HTC One rivals traditional digital cameras with improvements to every part of the camera, including the lens, the sensor, the software, and even integrating a new custom HTC ImageChip. These enhancements combine to deliver our fastest image capture, best image quality under adverse conditions and easiest interface that enables quick access to capturing stills and videos with side-by-side photo and video capture buttons.

  • Superfast Capture – HTC One dramatically reduces the time it takes to capture those key moments. In just 0.7 seconds you’re able to take a shot, and with a new superfast 0.2-seconds autofocus, continue to take nearly unlimited continuous shots simply by holding the shutter button.
  • Good photos in adverse conditions – HTC One delivers dramatic enhancements in image capture quality even in adverse conditions such as low light, no light or with bright backlighting. The f/2.0 lens on the HTC One X and HTC One S offers best-in-class performance, capturing 40 percent more light than the f/2.4 lenses available on other high-end phones. HTC One also includes HDR, a market-leading technology, for taking great photos even when there are varying levels of brightness.
  • Video Pic (Concurrent Video/Still Capture) – With Video Pic you capture a photo and shoot video at the same time. Now, while you’re shooting HD video, all you have to do is tap the shutter button and it snaps a high-resolution still photo while the video continues to shoot. You are also able to capture a photo frame from a previously recorded video.

Authentic Sound
With HTC One, Beats By Dr. Dre Audio™ integration is enabled for the first time across the entire experience for richer, more authentic sound whether you’re listening to your favorite music, watching a YouTube™ video or playing a game. … All this makes HTC One the one place to enjoy all your music, wherever you are, with the power of Beats By Dr. Dre Audio and HTC Car.

… HTC One X is blazing fast with the new NVIDIA® Tegra 3 Mobile Processor for clear graphics, faster applications and longer battery life. It includes a 1.5GHz Super 4-PLUS-1™ quad-core with an integrated fifth Battery Saver Core and a high-performance 12-Core NVIDIA® GPU. The HTC One X also has an amazing 4.7-inch, 720p HD screen crafted from contoured Corning™ Gorilla Glass. HTC One X will also be available in select 4G LTE markets with a LTE-enabled Qualcomm Snapdragon S4™ processor with up to 1.5GHz dual-core CPU’s.

The HTC One S is for people who want a high-end smartphone in a more compact size. It is powered by a Qualcomm Snapdragon S4 processor with up to 1.5GHz dual-core CPU’s. It also includes a 4.3-inch screen crafted from contoured Corning™ Gorilla Glass. …

Utilizing the classic, award-winning design of the HTC Legend, the HTC One V brings top-end design to a smartphone with broad appeal and a premium experience that delivers an amazing camera and authentic sound. It features a simple, iconic aluminum unibody design that exudes craftsmanship and quality.

Global Availability
With unprecedented excitement, the HTC One series will begin shipping in April with broad global availability available beginning in April through more than 140 mobile operators and distributors globally. For more information and to pre-register for HTC One visit www.htc.com.

HTC Rezound™, the only phone with the Beats Audio™ built in [HTC YouTube channel, Nov 3, 2011]

Experience your sound like never before.

HTC And Beats By Dr. Dre Set To  Introduce New Era In Mobile Audio [from the 2011 HTC press releases]:

Strategic HTC investment to result in Beats integrated HTC phones this Fall.

Taoyuan, Taiwan & Santa Monica, CA – August 11, 2011– HTC Corporation, a global designer of mobile devices, today announced a strategic partnership and investment with Beats™ Electronics LLC, the company redefining the audio market with its iconic Beats by Dr. Dre™ audio experience. The two fast-growing brands will focus on bringing high performance sound to HTC phones. …

… “Beats has found a unique way to harness popular culture in a manner that is unlike any other brand today,” said Peter Chou, CEO of HTC Corporation. “It’s an exciting brand that has been built around providing something very special, and we believe our strategic partnership will provide customers with unbeatable sound on HTC phones. We obsess over every detail of a consumer’s mobile experience and audio is a critical part of that experience.”

… Established in 2006, Beats Electronics is the brainchild of legendary artist and producer Dr. Dre and Chairman of Interscope Geffen A&M Records Jimmy Iovine, who set out to develop a new type of headphone with the capability to reproduce the full spectrum of sound that musical artists and producers hear in professional recording studios. For more information, please visithttp://beatsbydre.com.

The history of last HTC CFOs:

HTC Appoints Hui-Ming Cheng as CFO [HTC press release, Aug 23, 2006]

… he has served as CFO and Spokesperson for the Fubon Financial Holding Co. in Taipei. From October 2003 to February 2006, Mr. Cheng was VP and CFO of Taiwan Mobile and received the honor of being named as Taiwan’s best CFO by Institutional Investor Magazine in 2003. Prior to his appointment with Taiwan Mobile, Mr. Cheng held various senior-level positions with the Finance Center, Winbond Electronics Corp., China Development Industrial Bank, Chase Manhattan Bank, and the Asia Partner Fund.

Mr. Cheng received a BS in Chemical Engineering from National Taiwan University and an MBA from the Kelly School of Business at Indiana University.

HTC Announces Winston K. S. Yung as Chief Financial Officer [HTC press release, Dec 23, 2010]

… Prior to joining HTC, Yung was the Chief Financial Officer for Shin Kong Financial Holding in Taiwan where he played a key role in the company’s success, and also held key positions at McKinsey & Co in Hong Kong. Yung received a bachelor’s degree in social sciences with an economics major from University of Hong Kong and a MBA from the University of Pennsylvania’s Wharton Business School.

HM Cheng, HTC’s current chief financial officer will retire from the company and move into an advisory role to HTC’s board of directors. Cheng joined HTC in September 2006 and successfully established a complete financial system and was a key contributor to HTC’s corporate governance system and HTC’s overall financial success

HTC names Chia-Lin Chang Chief Financial Officer [from the Latest HTC press releases]

Taoyuan, Taiwan – April 16, 2012 – HTC, a global leader in mobile innovation and design, today announced the appointment of Chia-Lin Chang as Chief Financial Officer and spokesperson effective April 16, 2012.

Chia-Lin Chang’s predecessor, Winston Yung, joined HTC in January 2011. Winston will focus on corporate development, helping HTC maintain its competitive edge by strengthening the organization and corporate talent.

Chia-Lin, previously an investment banker and partner at Goldman Sachs, will be responsible for corporate finance and accounting, strategic acquisition and investment, and investor relations.  Chang earned a Ph.D. in Electrical Engineering from Princeton University and an M.B.A. from the Wharton School at University of Pennsylvania.  After receiving his Ph.D. degree, Chang served as an engineer at Motorola in the US.

GOLDMAN SACHS ANNOUNCES NEW MANAGING DIRECTORS [Goldmann Sachs press release, Oct 24, 2007] “… it has invited 299 individuals to become Managing Directors as of December 1, 2007, the start of the firm’s fiscal year. … Chia-Lin Chang …

From: Latest HTC press releases:

HTC releases unaudited results for 1Q 2012

Taoyuan, Taiwan – April  6, 2012 –HTC corporation (TWSE: 2498), a global leader in mobile innovation and design, today announces unaudited consolidated results for 1Q 2012. For the first quarter of 2012, total revenues reached NT$67,790 million, a decrease of 34.92% year-on-year. Unaudited operating income was NT$5,099 million, net income before tax was NT$5,551 million, net income after tax was NT$4,464 million, and unaudited earnings per share after tax were NT$5.35 based on 834,256 thousand weighted average number of shares.

2012 First Quarter Unaudited Consolidated Financial Results

(Unit: NT$ million, Except Earnings Per Share)

*Calculation of the after-tax EPS for first quarter 2011 was based on 807,867 thousand weighted average number of shares.

HTC Reports Fourth-quarter And Annual 2011 Results

Taoyuan, Taiwan, February 6, 2012– HTC Corporation (“HTC”, or the “Company”, TWSE: 2498), a global leader in mobile innovation and design, today announced consolidated results of the Company and its subsidiaries for the fourth quarter of 2011 and for the year.

4Q Highlights
• After-tax profit was NT$10.94bn, EPS was NT$13.06
• Total revenues were NT$101.42bn
• Gross profit margin and operating margin were 27.12% and 12.71%, respectively
2011 Highlights
• After-tax profit was NT$61.98bn, up 56.77% year-on-year; EPS was NT$73.32
• Total revenue was NT$465.79bn, up 67.09% year-on-year
• Gross profit margin and operating margin was 28.30% and 14.77%, respectively
• ROE was 70.37% compared to 56.33% in 2010

“In 2011 we saw growth in the global strength of our brand, as well as earnings and revenue growth,” said Peter Chou, CEO of HTC. “While short term performance may not meet the results as expected, we have gained further experience and advancement in the areas of brand management and product innovation. These fundamental strengths and the groundwork we have laid will take us into 2012 with a renewed focus and determination.”

4Q 2011 Results
HTC’s fourth quarter revenue came in-line at NT$101.42bn, resulting in after-tax earnings of NT$10.94bn and EPS of NT$13.06. Gross profit and operating margins came in at 27.12% and 12.71%, respectively. The decline in gross profit margin was mainly a result of product transition.

2011 Results
2011 annual revenue was NT$465.79bn, a 67.09% increase over 2010 annual revenues (NT$278.76bn), resulting in after-tax earnings of NT$61.98bn. Overall gross profits and operating margins were 28.30% and 14.77%, respectively.

In 2011, in addition to solid growth in revenues and profits, HTC’s brand gained significant momentum in the global landscape, being named one of Interbrand’s 100 Best Global Brands.

2012 Outlook
In 2012, HTC will focus on: growing the Company’s brand value; continuing to create competitive advantages through innovation; enhancing the efficiency of marketing campaigns; and further driving down operating costs.

To expand its brand preference and value, HTC will work at a global level to build emotional connections with consumers, putting more of its marketing resources behind fewer products and driving value in those product brands. By building a globalized marketing campaign, HTC aims to optimize its go-to-market strategy with operators, retail distributors, and end-users, and improve the efficiency of its marketing spend. In emerging markets, such as China, HTC will continue to extend its reach to customers by expanding distribution channels.

Despite temporary weakness resulting from product cycle transition, HTC believes it has the ability to create a new wave of momentum through the upcoming product cycle. It will also continue its attention on mass market consumers by driving product differentiation through design and innovation.

1Q Outlook
The Company’s outlook for the first quarter of 2012 is as follows:

• 1Q revenue expected to be around NT$65-70bn
• Gross margin expected to be around 25%
• Operating margin expected to be around 7.5%

These margins are a temporary phenomenon and will normalized when product cycle transition is over.



  1. […] high-volume market in China is ready to define the 2012 smartphone war [Jan 6 – Feb 17, 2012] – Tech investment banking expertise to strengthen the unique value focus of growing the HTC brand and … [April 18 – 25, […]

  2. […] ST-Ericsson is not the only proprietary SoC partner for HTC as indicated in the latest updates to Tech investment banking expertise to strengthen the unique value focus of growing the HTC brand and … [this “Experiencing the Cloud” blog, April 18-25, […]

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