Smartphone maker HTC shares tumble on disappointing sales outlook

Feb 7, 2012, 9:48 GMT

Taipei - Shares of HTC Corp tumbled 6.9 per cent Tuesday on the Taiwan Stock Exchange after the smartphone maker gave a pessimistic forecast for first-quarter revenues as it plans no new model releases until the end of this month.

The company predicted revenues would slide as much as 38 per cent from the same quarter last year and would range from 65 billion to 70 billion Taiwan dollars (2.2 to 2.37 billion US dollars) as its older models are being outsold by Apple Inc's iPhone 4S and Samsung Electronics Co's Galaxy S2.

Closing at a price of 513 Taiwan dollars per share, the stock has shed 57 per cent since its peak in April.

HTC released fourth-quarter earnings a month ago, showing that sales declined by 25.3 per cent from the third quarter and 2.49 per cent year-on-year to 101.42 billion Taiwan dollars.

Net profit at 10.94 billion Taiwan dollars suffered a 41.4-per-cent quarterly decline and a 26-per-cent drop from the same period last year.

Chief financial officer Winston Yung attributed the poor performance to disappointing sales for the company's high-end phone models that feature fourth-generation long-term evolution technology, which gives users a faster download speed than 3G. HTC also cut prices on many of its current phones as it prepares for the release of new models.

HTC's declining revenues come at a time when its main rivals, Apple and Samsung, are reporting robust results.

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