HTC 3Q 2013 Results: The Beginning of the End

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4Q 2013 | IN-1017669


HTC’s First Unprofitable Quarter


HTC reported revenues of NT47 billion in 3Q 2013, which represented a 34% drop in revenues from 2Q 2013. The gross margin declined from 23.2% in 2Q to 20.4% and operating income dropped to -7.4% from 1.6% in 2Q. ABI Research estimates that device shipments for HTC decreased 26% to 4.9 million units. HTC’s 3Q was plagued with supply constraints that limited its ability to deliver the HTC One Mini, which was launched in 3Q. This marks the first quarterly loss for HTC since it went public and revenue guidance for 4Q does not indicate an immediate return to profitability.

HTC Has Crossed the Rubicon


While it may seem an overreaction to consider HTC a failed venture after a single bad quarter, the last decade of market tracking has shown that once a handset OEM...

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