HTC: ‘Our flagship phones fell far short of our expectation in 2015’

HTC: ‘Our flagship phones fell far short of our expectation in 2015’
Credit: HTC

HTC reported its year-end results today and while they’re looking less scary than last quarter, everything isn’t rosy yet.

The company laid off a significant amount of employees over the past few months to help recover its profits, which helped a small amount and recovered around $900 million NT ($268,000 USD) in operating profit, to a loss of $4.1 billion NT ($122 million USD).

HTC’s CFO Hui-Ming Cheng said on the investor call that “to be very candid, our flagship [phones] did not perform well — actually, our flagships fell far short of our expectation for the entire cycle of 2015.”

Cheng continued that “we need to come up with one or two new hero products” to see the returns the company needs to recover.

“In the smartphone industry, the cost of doing business depends on where you’re doing it” — he wouldn’t name where, but blamed the price of “certification as well as research and development” in specific markets for the losses.

The company is investing “a lot of resources” into mid-range and premium smartphones for this year, as well as creating a flagship. “Our goal is to help the smartphone division turn a profit in 2016.”

HTC no longer breaks out its smartphone division’s sales or forecasts future quarters, so it’s hard to know just how bad it was in 2015.

On the topic of the RE:Camera, the company isn’t done with creating accessories for smartphones, specifically hinting at accessories for virtual reality. Cheng said “I think I can tell you” that it is creating a “camera solution will apply into [a] mobile virtual reality solution.”

Cheng did admit that the company had “high hopes” for the RE but felt that it approached it with the wrong sense of scale.

HTC is focused on Vive for 2016 with it hoping it will be a “meaningful” product that generates a lot of profit for the company, but wouldn’t elaborate on how exactly it’ll sell the product.

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