Telecom Lead Asia: Is HTC facing gloomy future? The
smartphone major has decided to close its Korea sales office. HTC faces immense
competition from Samsung in the Korean mobile market.
“As part of a regular review of all lines of
business and markets in which the company operates, HTC will close its Korea
sales office with immediate effect,” said an HTC spokesman in a statement.
HTC will continue to provide sales and customer support
through local mobile operator partners such as SK Telecom and KT, honor existing
product warranties, and endeavour to provide updates to existing products.
The struggling smartphone vendor believes Korea is one of
the advanced and fast growing smartphone markets in the world, and will
carefully evaluate introducing innovative mobile devices in Korea should the
opportunity arise in future.
HTC is betting on its new One series of phones to regain
market share lost to Samsung and Apple. But its decision to scale down
operations in Korea is likely to impact its long-term growth plans.
Last month, HTC cut its second-quarter revenue target by
more than 13 percent to T$91 billion and cut its operating margin forecast by 2
percentage points to 9 percent, but kept its gross margin target at 27 percent.
HTC cited the poor economic situation in Europe that was
hurting consumer demand, as well as delays to shipments of new phones to the
United States due to a requirement for customs inspections after it lost a
patent dispute with Apple. Earlier, HTC did not mention about its Korean plans.
According to IDC smartphone statistics report, Samsung,
Apple, Nokia, HTC and ZTE are the top 5 smartphone vendors in second quarter of
2012. Smartphone market grew at 42.1 percent year-over-year in second quarter
of 2012. Vendors shipped 153.9 million smartphones in 2Q12 compared to 108.3
million units in 2Q11.
Samsung gained by launching Galaxy S III. Samsung also
benefited from its smartphone/tablet hybrid device, the Galaxy Note.
IDC noted that HTC’s performance in the Asia/Pacific
region allowed it to climb back up the rank order.
Top Five Smartphone Vendors, Shipments, and Market Share,
Q2 2012 (Units in Millions)
|
|
2Q12 Unit |
|
2Q12 Market |
|
2Q11 Unit |
|
2Q11 Market |
|
Year-over- |
||
|
Vendor |
Shipments |
Share |
Shipments |
Share |
year Change |
||||||
|
Samsung |
50.2 |
32.6 percent |
18.4 |
17.0 percent |
172.8 percent |
||||||
|
Apple |
26.0 |
16.9 percent |
20.4 |
18.8 percent |
27.5 percent |
||||||
|
Nokia |
10.2 |
6.6 percent |
16.7 |
15.4 percent |
-38.9 percent |
||||||
|
HTC |
8.8 |
5.7 percent |
11.6 |
10.7 percent |
-24.1 percent |
||||||
|
ZTE |
8.0 |
5.2 percent |
2.0 |
1.8 percent |
300.0 percent |
||||||
|
Others |
50.7 |
32.9 percent |
39.2 |
36.2 percent |
29.3 percent |
||||||
|
|
|||||||||||
|
Total |
153.9 |
100.0 percent |
108.3 |
100.0 percent |
42.1 percent |
Source: IDC Worldwide Mobile Phone Tracker, July 26, 2012
Note: Vendor shipments are branded shipments and exclude
OEM sales for all vendors.
HTC’s second-quarter revenue grew to T$91 billion,
improving from T$67.79 billion in the previous quarter. HTC’s unaudited
April-June net profit was T$7.4 billion, down from T$17.52 billion in the same
period a year earlier, but up from T$4.47 billion in the January-March quarter.
HTC said consolidated sales for June were T$30 billion, down 33.4 percent from
the same month a year earlier and unchanged from May.
Recently, Samsung posted record second-quarter earnings,
driven by runaway sales of its Galaxy smartphone.
Besides HTC, phone vendors such as Nokia, Research In
Motion, LG, Motorola and Sony Mobile are struggling to keep pace with Apple and
Samsung. They are unable to compete with Apple’s focus on innovation and
outsourcing model and Samsung’s strategies on building next generation
smartphones and tablets.
editor@telecomlead.com
