HTC's performance falls for 5 consecutive quarters

Under the fierce competition in the mobile phone industry, HTC suffered a loss. The second-quarter 2016 financial report showed that the loss for the current period was approximately 881 million yuan, which was already the fifth consecutive loss for HTC. HTC once rivaled Samsung and Apple. Its market value had reached 33.5 billion U.S. dollars in 2011, but it has now shrunk to less than 2 billion U.S. dollars. The industry believes that the decline of HTC stems from the loss of Apple’s patent lawsuit in that year. After this heavy hit, HTC, which has been sticking to the high-end line, is still unwilling to put aside its position. As a result, under the premise of high-end machines, it has also emerged rapidly. China's low-end smart phone (such as millet) market missed.

Currently, HTC has already bet its own half of its business into the VR field, trying to take advantage of the transformation to improve the current predicament. In response, many interviewees said that the VR market has not really emerged, and it is impossible to give HTC financial revenue in the short term. Bring too much contribution.

In addition, the reporter contacted the HTC related person in charge of HTC's adjustment and layout of the mobile phone business and VR business. The other party stated that the spokesperson travels frequently and does not respond to the interview content.

Performance slides highlight the middle-aged crisis

On August 2nd, HTC released its second-quarter 2016 financial report, showing current revenue of 18.9 billion Taiwan dollars, approximately 4 billion yuan, gross profit margin of 11.4%, operating loss of 4.2 billion New Taiwan dollars, or approximately 881 million yuan. The operating margin is -22.5%. In this financial report, HTC's newly released flagship smartphones, HTC 10 and HTC Vive, did not perform well in terms of profitability.

This is already the second quarter of 2015, with HTC operating losses for the fifth consecutive quarter. So far, HTC has continuously lost 21.3 billion Taiwan dollars, or about 4.85 billion yuan.

In this regard, communications expert Xiang Ligang pointed out that HTC is currently undergoing transformational pains. While the market share of mobile phone services is getting smaller and smaller, it has also entered the VR field. Although HTC Vive products have a good response, VR has a relatively small market share. If you want to rely on it to make money more difficult, in such circumstances, the loss becomes inevitable.

In fact, HTC was once ranked first in the development of the world's mobile phone manufacturers, and rivals Apple, Samsung and others, and reached its peak in 2011, with a market value of US$33.5 billion. According to public statistics, in 2011, HTC’s mobile phone sales reached 43 million units, accounting for 9.1% of the global market.

Regrettably, HTC had its first deficit after two years. After 4 years, the market value has shrunk to less than 2 billion U.S. dollars.

According to the latest data released by TrendForce, HTC's handset shipments in the first quarter of 2016 were 2.67 million units, and the 2016 full-year shipment volume was expected to be 13.17 million units, down 26.8 percent from 18 million units in 2015, compared to 2011. The 43 million units fell 69.4%.

It is reported that HTC's real encounter with Waterloo was a failure in Apple's patent litigation in 2011. In 2011, the US International Trade Commission ruled that HTC infringed Apple's iPhone 647 patent, and from April 19, 2012, imposed an import ban on HTC's smartphones that involved the patent. Xiang Ligang believes that HTC suffered a rapid decline in the global market.

Sticking to high-end missed Chinese market

With the help of the Android system, HTC announced in July 2010 that it was officially entering the mobile phone market in Mainland China. Zhou Yongming, then CEO of HTC, once expressed his concern for channel construction: “We will build HTC sales channels through the upstream and downstream of the industrial chain. Operators and retailers are very important channels for us.”

However, HTC ultimately did not grasp the opportunity for the development of the mainland mobile phone market.

Professor Su Yong, director of the enterprise management department of Fudan University School of Management, who has conducted in-depth studies on HTC, pointed out that the decline of HTC's mobile phone business has two main reasons: “First, Huawei’s mobile phone manufacturers such as Huawei and Xiaomi have risen rapidly, which is the original of HTC. The mobile phone market has caused great impact; secondly, HTC has encountered some problems in its product positioning and strategic positioning under the situation of increasing competition. Although HTC has proposed to take the high-end route, there are Apple, Samsung, etc. in the high-end market. The mobile phone giant, which has firmly occupied the high-end market."

In reality, the idea of ​​HTC sticking to the high-end line seems to have not changed so far. It is understood that HTC's latest HTC lifestyle 10 has been sold overseas, priced at 52,800 Indian rupees, or about 5,185 yuan, the HTC 10 configuration in the domestic distribution is relatively low compared to the former, but also up to 3799 yuan in pricing.

In addition, Xiang Ligang also pointed out that HTC as a company with a Taiwan background has a certain affinity for the mainland, but its poor strategic operation has resulted in poor performance in the mainland market. Even if it consolidates the market, there are also Great challenge.

Moreover, compared with the Internet mobile phone brand hype promotion, Xiang Ligang said that HTC's performance in the Zhou Yongming era is not very good channel construction, lack of appropriate and timely adjustments.

VR desperate or difficult to rescue the city

When the entire mobile phone market has touched the ceiling of development and its own mobile phone business cannot support profit growth, HTC turned to the VR field and officially released the HTC Vive on March 1, 2015.

In the face of performance losses in the second quarter of 2016, HTC Global Sales President Zhang Jialin stated that the company expects HTC Vive's shipments to increase in the second half of this year compared to the first half of the year and hopes this can help the company achieve revenue in the third quarter. Branch balance.

According to market research firm IDC, global shipments of virtual reality devices will exceed 9 million units in 2016. At the same time, China's VR virtual reality device shipments will reach 480,000 units in 2016, an increase of 476% compared to 2015.

The market's good prospects for VR have further contributed to HTC's determination to transform VR. HTC Chairman Wang Xuehong once told the media that the proportion of the company's mobile phone and VR business was "50% to 50%." Regarding this proportion, Xiang Ligang said that Chinese companies such as Xiaomi and Huawei are still in the stage of asking for advice on VR, and there has not yet been such a large investment in a company like HTC.

Analyst Zhao Ziming pointed out this point: Compared with the sluggishness of the HTC mobile phone business in the global market, it can be said that HTCVive is already the lifeline of HTC.

Not long ago, HCT announced at the Shanghai World Mobile Conference that it will join 28 global top venture capital companies and set up a virtual reality venture capital alliance. It is expected that it will invest tens of billions of dollars to promote the development of the global virtual reality industry. In addition, it has also confirmed the separation of the initial VR business and established the HTC VIVE Tech subsidiary, which is completely controlled by HTC.

It is worth noting that on August 9th, HTC and Alibaba Cloud announced that they will establish a strategic partnership to jointly explore new solutions for cloud computing and virtual reality technology.

“In the development strategy, VR is an exploration direction for HTC. The most important thing for HTC is to summarize the technological innovation route that used to take advantage of the past. Since the time for HTC to enter the mobile phone industry is not too early, first start with OEM. , and then step by step to create a brand, and now jumped from the mobile phone industry to VR, no accumulation of technology, is entirely an independent R & D. "Su Yong believes that the current commercial application of VR is still not clear, HTC There are still many problems to be solved by leveraging VR to return to the top.

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