HTC's phone business has been struggling for quite a while now. While the Taiwanese tech giant managed to cut its Q3 2016 losses in a rather remarkable manner, it's still suffering from the same problem most other Android OEMs do – it's struggling to break even. For added context, the fact that the company's operating loss during the third quarter of this year amounted to less than $60 million was recently presented as a success. Frankly, that's because it was.
So, the Taiwanese consumer electronics manufacturer is currently trying to figure out a more efficient strategy for 2017. However, latest industry reports suggest that regardless of what HTC does, its overall sales are bound to stagnate next year. As DigiTimes reports, industry sources have recently indicated that HTC is having trouble with increasing production of the HTC Vive, the company's biggest ray of hope for revenue growth in 2017. More specifically, latest estimates suggest that the firm will manage to ship a little more than 400,000 HTC Vive units by the end of the year. That number will realistically grow by no more than 50% next year because industry sources indicate that HTC is facing a shortage of components crucial for manufacturing the said VR headset.
In addition to that, DigiTimes' report states that even if HTC could produce as many HTC Vive units as it could, the company's immediate prospects in the VR industry aren't too bright seeing how the market for high-end VR headsets is still rather restricted. Of course, the fact that the HTC Vive boasts no system-selling apps and games also doesn't help, but its price tag is the biggest obstacle for HTC and the company's mission to make a strong foothold in the VR market.
Regarding HTC's phone sales, DigiTimes reports that they are expected to remain flat throughout 2017. The number one problem HTC's phone division is reportedly facing has to do with the company's rapidly diminishing brand value. Interestingly enough, despite the fact that the Taiwanese tech giant is in all likelihood manufacturing the Google Pixel and the Google Pixel XL, industry sources claim that the Taoyuan-based company likely won't generate a lot of additional revenue due to that collaboration with Google. Namely, HTC is only producing these flagships on an OEM basis, so apart from not getting a significant cut of the profits, Google's latest smartphones also won't help mitigate HTC's brand-related issues.