Carriers Dump HTC As Profits Tumble Due To VR & Blockchain Phone Investments
Desperate to find something, or someone to blame for their woeful business decisions HTC management is now blaming a lack of traction for its new blockchain phone and virtual reality (VR) headsets for their latest round of losses.
In Australia both carriers and retailers have dumped the Taiwanese phone brand despite it once being one of the top two smartphones brands sold at retailers.
Quarterly losses at the Taiwanese phone Company have blown out to over A$117 million in the last quarter, with several analysts claiming that the Company should not have got into the VR headset or blockchain phone market.
It lost NT$3.1 billion in the third quarter of last year, while it posted losses of NT$2.1 billion for the second quarter of this year.
The smartphone maker has been locked in a spiral of quarterly losses for about three years, except for the first quarter of this year, when it booked net profit of NT$21.1 billion after selling its handset manufacturing team to Alphabet Inc’s Google for US$1.1 billion.
As HTC struggles to return to the black retailers and carriers are cutting back the ranging of HTC. Telstra and Optus who 18 months ago were major sellers of HTC devices has no HTC devices currently ranged online.
Its operating margin dipped to minus-68.9 percent last quarter from minus-50.7 percent in the second quarter, compared with minus-20.9 percent in the third quarter of last year.
Its gross margin improved for a second straight quarter to 4.7 percent from 2.7 percent in the second quarter but was still down from 10 percent in the same period last year.
Revenue plunged to NT$4 billion from NT$6.8 billion in the previous quarter and NT$15.7 billion a year earlier.
HTC said it would continue to invest in research and development as well as on expanding its VR ecosystem.
It launched the mid-range HTC U12 life last month and is to start shipping its first blockchain phone Exodus 1 next month.
HTC is accepting pre-orders for the Exodus 1 in cryptocurrencies only, at the price of 0.15 bitcoins, or 4.78 ethers.