HTC, Amid Q4 Weakness, Says Changes, Growth Ahead

HTC's sales continue to tumble. But with plans for a wearable device, a tablet and a more well-rounded portfolio, it's optimistic about 2014.


Smartphone maker HTC continues to struggle for a comeback. On Feb. 10, the Taiwan-based company announced fourth-quarter 2013 results that included 27 consecutive months of declining revenue and a 38 percent year-over-year sales drop to $319 million.

Still, it remains hopeful that things are about to change.

"We believe this quarter will be the lowest quarter that we'll see. We're seeing sequential increase in the coming quarters for 2014," Chief Financial Officer Chia-Lin Chang said during the earnings call, according to a transcript from Seeking Alpha. "… We believe in 2014, we're going to see both revenue and profitability growth."

Chang said that HTC plans to have a much more "robust" portfolio. While last year it focused (too single-mindedly, Chang suggested) on its flagship device, in 2014, it plans to offer more midrange and low-cost devices.

The major operators and HTC's channel partners, said Chang, are "very excited about our product lineup."

In the coming "days and weeks," Chang added, HTC plans to make some announcements. A likely bet is that HTC will share news at the Mobile World Congress 2014 event, which will take place in Barcelona, Spain, Feb. 24 through 27.

According to multiple sources, HTC is planning to introduce a smartphone called the M8, as well as an M8 mini, said to feature a 4.5-inch, 720p display, a quad-core 1.4GHz Qualcomm Snapdragon chipset, 1GB of RAM, HTC's Sense 6.0 user interface, Android 4.4.2 (KitKat), a 13-megapixel primary camera and a 5-megapixel front-facing camera.

The M8 is said to feature a 5-inch, 1080p display and a quad-core processor.

Androidandme reported Feb. 10 that invitations to an M8 event are "going out shortly."

Also contributing to HTC's expected growth, said Chang, is the company's readiness to meet demand. "We feel a lot more comfortable in terms of the overall delivery time to market and everything … We feel comfortable and confident."

HTC also has an "exciting" marketing campaign planned that will enable the company to communicate better with consumers.

Finally, Chang also confirmed that HTC plans to deliver a wearable device.

"It's our chairman and also our CEO's vision together," said Chang, answering a question regarding comments Chairman Cher Wang made to Bloomberg, particularly that HTC will ship a wearable device in time for the holidays.

"What they are seeing is a future smart city or smart world," Chang continued. "There are going to be different buckets or different categories of products. They are going to play their roles fitting this world as smart devices, and wearables is part of it."

Wang told Bloomberg, according to a Feb. 7 report, "Many years ago we started looking at smartwatches and wearables, but we believe that we really have to solve the battery problems and the LCD light problems."

Wang and HTC CEO Peter Chou, during an October 2013 interview with the Financial Times, confirmed HTC is working on wearable device, as well as a tablet.

"When the tablet comes out," said Wang, "it will be something nice and disruptive."