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Money-losing HTC predicts a turnaround in Q2

TAIPEI--Taiwanese smartphone maker HTC Corp. (宏達電) forecast Tuesday that it will return to profitability in the second quarter after posting operating losses for three consecutive quarters.

The Taoyuan-based company said its second-quarter consolidated revenue will be between NT$65 billion (US$2.16 billion) and NT$70 billion, which would be roughly double that of the previous quarter, and it estimated gross margin at 21.3 percent to 22.0 percent.

Those projections would yield earnings per share of NT$2.21 to NT$3.00, according to HTC.

“In order to maximize the success of our critically acclaimed HTC One M8, we have dramatically improved our operational efficiency and supply chain readiness to ensure immediate availability on the launch day,” HTC Chief Executive Officer (CEO) Peter Chou (周永明) said.

“Looking ahead, we are excited about the many new opportunities from the rapid development of time division long-term evolution (TD-LTE) in China and LTE in Taiwan. We believe that we are on course for a strong 2014,” he said in an e-mailed statement.

HTC said its sales in Europe, the Middle East and Africa remained solid, largely due to a successful launch of the HTC One M8, as well as continuous momentum from in-life products including last year's HTC One (M7), the HTC One mini and the HTC Desire 500.

In China and India, both the HTC One M8 and HTC Desire 816 have shown strong momentum, the company said.

In the first three months of 2014, the company posted a net loss of NT$1.88 billion, or a loss per share of NT$2.28, on consolidated sales of NT$33.1 billion. Its gross margin was 21.0 percent and operating margin was minus 6.2 percent during the first quarter.

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