It seems no good thing lasts too long, at least for HTC. The HTC One provided them much needed hope for recovery, and even though it didn’t represent a huge turnaround, it was great for the company’s morale, and for the company’s customers who wanted to see the company recover.
However, when you put things in perspective, HTC had 83% less profit and 25% fewer sales compared to the same period last year. So the company is definitely not out of the woods yet , no matter how good and how praised the HTC One was.
That’s not actually the bad news, the really bad news is that it seems the recovery will slow down in the next quarter, because of wider availability of the Galaxy S4, the upcoming iPhone 5S, and many other Chinese competitors that are starting to undercut more known companies like HTC on price, while offering better specs (although perhaps not as good quality, but some of them are getting there).
“HTC may have new products in Q3, but competition from Apple and other Chinese brands are fierce,” said Taipei-based analyst Peter Liao of Nomura Securities. “It’ll be hard to keep the growth.”
To get through this, HTC will need another flagship this fall, that is quite different from the HTC One line. That one could be the rumored HTC One Max, a larger 6″ HTC One with better specs, but it remains to be seen if a larger HTC One will be at least as popular as the HTC One for HTC to maintain its current revenue and profits, at the very least.
In fall, we’re expecting to see Nexus 5, Note 3, some new Motorola phones (from the RAZR category most likely), Sony i1 “Honami”, LG Optimus G2, and of course the iPhone 5S. So things are definitely not going to be a walk in the park for HTC this fall. But if they can survive the next 2-3 quarters, they have another shot next year with the next-generation HTC One.
Hopefully, by then HTC will have learned what it takes to make its products successful in the market, and will double down on those strategies for the next-gen HTC One. Things like stronger branding, bigger advertising campaigns, and wider carrier distribution should be their priorities in 2014. HTC needs to go big next year, and I’m not talking about their phones’ screen sizes.