Taiwanese manufacturer HTC’s fortunes seem to be going from bad to worse without any signs of turnaround. Just a few days ago the company announced its quarterly results and as expected, it had lost as much as $260 million in the three months between April to June this year. As a result of the company’s myriad problems, the stock price was already at an all-time low at the start of this month. The Q2 result and poor guidance for the upcoming quarter has now seemingly pushed investors over the edge, and for the first time in the company’s history since going public in 2002, share prices have fallen below the 70 New Taiwan Dollar mark (about $2.26).
According to a report carried by Chinapost, HTC earned consolidated revenues of NT$8.68 billion ($280 million) last June, which made it the company’s worst performing month since February of last year. HTC’s shares have fallen by an astounding 26 percent since the company issued a profit warning last month, saying it could lose around NT$9.7 – NT$9.94 ($0.31 – $0.32) in Q2, 2015. The broader market in Taiwan has seen a major sell-off on Thursday amidst disappointing trade data in a country almost entirely dependent of exports. The weakening overall economic scenario at home aggravated matters further for the beleaguered company amidst deteriorating investor confidence after a series of underperforming quarters. According to Chinapost, the current downturn in the fortune of the company can be directly attributed to weakening global demand for HTC’s handsets and overall cooling of the Chinese economy in recent times.
The losses have come amidst declining sales and dwindling market share for the Taiwanese smartphone vendor, whose current-generation flagship, the One M9 has received a lukewarm response from the media and consumers alike. The company is struggling to hold its own with growing competition from bigger companies like Apple and Samsung at the higher end and myriad Chinese and Taiwanese brands like Asus, Lenovo, and Xiaomi etc. at the mid-range especially in critical markets like China and India. The complete absence at the entry-level probably hasn’t helped the company either, but then again, HTC has always been a company more focused on margins than market share.