• MOST READ

• LATEST NEWS

HTC pointed to several key achievements underpinning another strong quarter - riding the Android wave in order to scale up its volumes; adopting a rapid design cycle with strong attention to software; and focusing heavily on north American and then on European branding. This has turned the firm into a high impact smartphone maker rather than a white label and niche vendor, but it still has challenges ahead. One will be to take advantage of the tablet boom while that continues, another will be to stave off the new attack from Samsung.

In the fourth quarter of 2010, sales were NT$104bn ($3.6bn) and HTC reported a huge 160% year-on-year leap in net profits to reach NT$14.6bn ($500m). It sold 9.1m handsets in the quarter, up 163%, and a large percentage of its full-year total of 24.6m units even considering the holiday season effect. The 2010 unit sales figure was up 111% on the previous year while annual revenue rose 93% to NT$278.8bn ($9.57bn). Average selling price was up to $364.

The end-of-year leap in shipments was in sharp contrast to the results at Sony Ericsson, which sold 11.2m handsets in Q4, less than a quarter of its 2010 total. This highlights how the Taiwanese supplier is breathing down the neck of the former number three handset vendor (and Motorola) - though there may be some rebalancing in the current quarter, when HTC is forecasting shipments of 8.5m smartphones and SEMC will announce heavyweight new models, probably including the PlayStation phone. HTC's outlook would still suggest a significant rise in unit sales in 2011 compared to 2010.

HTC critics claim that, despite its impressively rapid design cycle for handsets, it is lagging behind on tablets. An Android Honeycomb launch is expected this quarter, but CEO Peter Chou commented : "It's a new market with many competitors, and we don't want to rush into it. We hope the product we eventually unveil will be one that meets consumers' needs." That will certainly mean waiting for the Honeycomb release of Android, the first suited to larger screens, and combining it with the powerful HTC Sense user interface.

The stars of the fourth quarter were the high end Android handsets, such as the Droid Incredible and Desire, the HD7 - HTC's first running WP7 (it remains the market leader in Windows phones) - and affordable smartphones like the Wildfire.

"The year 2010 was a breakthrough year," said Chou on the earnings call. "Going from a company of no scale to one of scale, that process was faster than I expected. Last year was the year that smartphones exploded."

Priorities for sustaining momentum in 2011 will include further acceleration of product development, a refresh of the software platform, and an increased focus on emerging markets. HTC recently started selling phones in China under its own brand for the first time. Currently North America accounts for just over 50% of revenues, Europe for 32% and the rest of the world, mainly Asia, for 17%. It clearly needs to even out that balance as the western smartphone markets become saturated and even more competitive.

Related Stories

COMMENTS

No comments yet. Be the first to add a comment!

Carrier Broadband Performance: Africa & Middle East
Carriers are using mobile broadband as their weapon of choice in the fight against the commoditization of voice and falling ARPU. This...

Voice over LTE: Market Analysis and Forecasts
VoLTE offer unique advantages in lowering a carrier's voice infrastructure economics and promises to improve voice quality, device...