HTC posts ugly Q4 2012 profits of just $35 million

HTC has posted their financial results for the fourth quarter of 2012, and the results aren't very pretty. Normally, Q4 is a pretty good time to be an electronics manufacturer, but last year HTC only was able to pull in just NT$1 billion ( about $34.5 million) on NT$60 billion ( about $2.7 billion) in sales. The full, but brief, overview of the numbers is at the source link.

While most of us reading would be ecstatic to pocket $34,000,000.00, this number pales when compared to results from Samsung and Apple -- HTC's major competitors and known money making machines. The good news is that HTC understands they have a cash problem, and thinks they have an idea how to solve it -- marketing. The hiring of a new marketing chief and a refocus on the quality of their products is the plan for 2013. We hope it works well for HTC, as a market dominated by one player isn't good for anyone.

Source: HTC (opens in new tab)

Jerry Hildenbrand
Senior Editor — Google Ecosystem

Jerry is an amateur woodworker and struggling shade tree mechanic. There's nothing he can't take apart, but many things he can't reassemble. You'll find him writing and speaking his loud opinion on Android Central and occasionally on Twitter.

  • What is HTC's goal here? Apple and Samsung are clearly established #1 and #2 but it seems like HTC is not resigned to this and are trying to maneuver to overthrow one of the reigning kings. but why? why isnt #3 good enough?
  • Because if you plan on being #3, you quickly become #5.
  • Bingo!
  • +9000
  • I don't think their industry ranking is the concern but rather their very viability as a company. Unless their present course changes, and changes fast, they'll be joining RIM in the history of once leading companies who stumbled their way straight into bankruptcy. Unfortunately, their comments on the source of their troubles don't give the impression they know what's wrong. Marketing might be part of the problem, but it's not the main one. Flawed products, a lack of support and carrier exclusivity is, and those are issues they can't just market away. They can come out with the best product, but if it's only available on 1 carrier, they've cut their potential sales to a fraction of what they could be. And if they're going to stick to controversial design choices (non-replaceable batteries and no expandable memory), they damn well better make sure the overall design alleviates the impact of those choices - by including a sufficient capacity battery and ample on-board storage. If I can't get through a day on a charge, and I can't swap in a fresh battery and I can't fit a few movies on the internal memory and I can't throw in an SC card... I'm not going to buy your damn phone! Hmmm, how strange that market leader Samsung suffers from none of these issues. Could it be that Samsung actually gives consumers what they want? Wouldn't that be amazing if giving consumers what they want, on the carriers they use resulted in high sales numbers? Wow, it can't be THAT simple... can it?
  • Ever since i saw the HTC Diamond I've always loved HTC. I just hope they don't go the way of RIM. I hate choosing new manufactures for my phone.
  • I agree. I seems they are just trying to find the next gimmick(i.e.Evo 3D) to survive on and thats my greater point. Why not give the consumer base what it wants and call it a day? Yes its a risk but so is any business venture. Apple and Samsung didn't become the behemoths they are overnight but rather with strategies that started years ago that are just now coming to fruition. HTC's path to where they are now has been quite different. And if failure is inevitable then personally I would rather go out doing what I know was best rather than running around with like a chicken with my head cutoff, if it all leads to the same place. I say let the big 2 be the big 2 and just worry about putting out the best products they can, not the best products the next guy can make
  • "I say let the big 2 be the big 2 and just worry about putting out the best products they can" But what constitutes the "best" product is subjective. Some people want a huge screen, some want a quad core processor, some don't mind a built-in battery, etc. Ultimately, sales numbers are the only thing that has a material effect on a company's ability to continue to exist. And a company doesn't exist to peruse some ideal - companies don't have ideals, they exist to make a profit. Plain and simple. So at some point, the "best" phone is the one that returns the most net profits to the company. Unfortunately, HTC's products have been returning less and less profits which, at some point, will equal NO profits. Had the One X and S had removable batteries, SD cards AND were available on all carriers, HTC would have been in an entirely different position today. Guaranteed. People still praise the One X for perhaps the best screen on a phone, and the One S for being arguably the sleekest overall design. But instead what are those two models remembered for? Poor battery capacity, ~9 gigs of useable non-upgradeable storage, and poor multitasking due to an overly resource heavy UI. And they can't just give ground to Samsung and Apple. As someone else said, if they shoot for #3, they'll find themselves #5, because other companies are always trying to move up. And there's really no reason for them to do so right from the start - they don't lack the design expertise nor the manufacturing capacity. For some reason, they just lack the common sense to give customers the features they want. And because they don't give customers the features they want, their phones are in low demand and that reduces their leverage with the carriers. Where Samsung can simply say to the carriers "Here's our Galaxy S 4, people are already lined up to purchase it, so take it as is", and they do, HTC has to give all kinds of ground to carriers in the form of customizations and exclusivity. Hopefully this will all change. Overall, they're my favorite manufacturer, but unfortunately, their current products just aren't as compelling or available as other manufacturers. Why would I buy a One S or X when I can get an S3 with none of the limitations of battery and storage? And even if I was willing to live with the built-in battery and no SD card, why would I buy a One S or X over a Nexus 4 for about 1/2 the price, no carrier lock-in and guaranteed timely updates? The simple answer is that I wouldn't.
  • About making your best device available to all carriers and maybe just maybe they be able to sell more.
  • npco543, you hit the nail right on the head. One of the main reason why I and many people I know didn't opt to buy any of the new HTC devices (I'm came from an AMOLED Droid Incredible which was an awesome phone.) Is due to the direction HTC took with the hardware more than anything else. No removable battery, No SD card = No deal. Even with my incredible I needed to get a new battery and eventually an HTC branded extended one, same goes for the storage. As i started to download more apps and keeps more things on my phone (ROM back ups, music, movies..etc) I needed and external SD card. When I was ready to get another phone the only phone that met that criteria (as well as having good developer support) was the Galaxy S3. I really hope HTC changes their game because they have the potential to make awesome products as they have done in the past.
  • My experience with HTC mirrors Ravi Shah's exactly! I loved my Droid Incredible but was "forced" into a S3 because that is/was the only phone avalable with a removable battery & expandable memory. Had HTC made a phone with the above features, I would have bought one again. B.T.W. What is the upper left picture next to the CEO for HTC??? It looks like something melting on a bbq grill... I that the old marketing chief?!?
  • So we're going to pretend that the iPhone doesn't exist? It has never had a removable battery and never had expandable storage. I understand that we're not iPhone users here, but saying those are controversial design choices and that nobody wants a device with those two features missing is silly, at best. I don't agree with the "flawed products" or the "lack of support" argument either. I am not saying their products or support are perfect, but they are no worse than anyone else's and, quite honestly, better than most. Up until the last year they were better than everyone but Apple. And that includes Samsung. My opinion is that their build quality is second to none. Do they have software issues? Sure! Everyone does, even the Nexus phones have little issues here and there. When you add your own UI, which everyone does, the problems can become greater. But no worse than problems that LG and Samsung and Motorola have with their devices. I agree 100% with your notion of the carrier exclusivity, though. That is the real killer. I would love to have a DNA on Sprint. I have friends on AT&T and T-Mo who would love my EVO. But being handcuffed to one carrier is the real killer here. And for what it's worth, between my wife and my kids we have been through two GSIII's and four GSII's in my house over the last 12 months, each with their own problems, both software and hardware. But I am still on my launch-day EVO LTE and have only had minor software issues that have been corrected with any of the three updates that have been pushed to my device by HTC over the last 6 months. And, while not a hardcore gamer, I use my phone to run my business and can not have a battery that dies twice a day. Despite the non-swappable battery I took the plunge because I really like the EVO line, and I have yet to see my battery die before I get home in the evening. I'm not saying HTC is perfect, but let's not pretend that Samsung is spending their days walking on water.
  • I agree with you for the most part, except for the two design issues. Missing a removable battery and expandable storage on the iphone is not a huge issue because it would still last a whole day for the average person. Even if you are a power user you could easily find tons of extended battery cases. And you want more storage you can opt of a 32 or even a 64 gig iphone. Even though battery and storage is not removable, it's not a huge compromise like the one x and dna phones we have in the states.
  • npco543. A more eloquent comment has not been made on this topic!
  • All great points, and bravo for not bringing up what most fools think is the problem...Sense.
  • Damn I feel bad for HTC After the Original Droid Incredible and Original EVO Stuff just went down hill
  • I loved the original EVO. I would LOVE a HTC Nexus. Their build quality is very good. Their radios could not be any worse than Samsung. I have 4G outside of my house, then as soon as I enter..... GONE! dammit Samsung.
  • Remember their foolish decision to put the clamps on their bootloaders with the Evo 3D and Sensation? They lost a lot of their loyal base with that decision, and it's hurt them more than they'll ever know. I was seriously on the HTC bandwagon before that, but ever since then, I've had 3 devices, all Samsung.
  • Right, because they definitely haven't changed their ways since then. Oh, wait... If you complain about anything hackery-related, complain about HTC releasing kernel sources late, as that's really the only thing there is to complain about. I had no trouble whatsoever unlocking the bootloader on my EVO LTE through HTC Dev. I don't know all the history, but my guess is that the modder community cried out against HTC, and they responded by not preventing bootloader unlocking anymore (unless Verizon or AT&T is involved, of course). This isn't LG we're talking about here, who HAS been encrypting bootloaders recently (like in the Optimus G and Optimus 4X HD).
  • Better marketing will help greatly. They have a quality product but what would instantly sell me is a high end device with stock android.
  • This!
  • Off topic: ... Just $34 million.... The things I'd do with just $1 Million...
  • This. All this talk of bankruptcy is nonsense. You don't go bankrupt when you're pulling in 34 million a quarter in pure profit.
  • But jerry, you have to admit that according to how far HTC has fallen since the same quarter last year, if history repeats the same drop between now and the same quarter in 2014(which it almost certainly will because HTC has completely lost its edge and can no longer compete) HTC will in fact be bankrupt. I for one truly believe that by late 2015/early 2016, HTC will cease to exist as an stand alone entity. It will most likely be bought by Samsung, Apple, or even God forbid, ZTE or Huawei, for its patent portfolio and dismantled. Be prepared, it's gonna happen.....
  • You don't survive long either. Only earning $34 million means its difficult to do anything. It means they won't be able to invest in new production methods. It means they won't be able to research improvements to their materials, or anything else related to their business. They will, essentially, be treading water because they can't afford to do anything else. That $34 million is the final canary in the coal mine. At the rate their financials have declined, they will not last long if they decline even further.
  • I've been saying for a while they needed to fix their marketing. Hopefully they are finally listening to their fans.
  • Ouch.
  • maybe put even a little internal storage in your phones, and a decent battery or at least a removable one... until then your phones are useless to me .... dealbreakers....
  • Well, my EVO has a non-swappable battery that runs all day with no problems. It also has about 1.5GB of app storage and 3.8GB of phone storage remaining. That's after the 40 apps I have installed from Google Play, the existing apps (Maps, Google Now, Google+, etc.) that are preloaded and the 60+ songs I have on there. Not too bad. And I also have a 32GB microSD card, so I'm pretty good with it. The one thing I wish it had was more than the 1GB of RAM. But I guess that gets corrected this year.
  • I have the tbolt and am happy with storage, but the phones they put out in 2012 mostly have 16g storage and that is a joke!
  • Where is the M7????
  • Being unveiled at Mobile World Congress like every other major mobile device.
  • HTC needs to take a page out of Samsung's playbook and release devices (both Android and Windows Phone) that are unaltered on all carriers. That's definitely not a panacea, but it's a good start.
  • Simple solution would be to stop releasing so many devices, stop making different variations of the same device (ONE X+), update your devices more frequently and stop locking those who choose to modify their devices out of the important parts (example: keeping devices S-ON).
  • Yup! Don't bone early adopters who bought the One X by comming out with a One X+ 3 months later!
  • Kinda comical when people are upset with making $35 million in a quarter of a year #EarthProblems
  • Well as a thunderbolt owner and my wife being an incredible II owner I can say we won't stay with HTC. While we aren't upset over the quality of hardware, but the lack of time and effort in giving us the ics update has prooved the only way to go and stay with android is either samsung or a google nexus device. I can say our next device will not be htc. This is the difference really; Iphone users most of them stay iphone users, everyone I know who has a galaxy III has already said they are staying with samsung, this is htc's problem can't build loyalty.
  • Marketing is good, but I think the real problem is that they cave to the carriers too easily. They need to be firm with the carriers, especially Verizon, and make phones that will sell, and fewer variations so that all the carriers get the same or very close to the same model. Letting carriers like Verizon cripple their devices in order to protect someone elses isn't going to get them anywhere.
  • HTC needs to rework their entire strategy. I know I got tired of their smartphones when they decided to remove the microSD slot and option of a removable battery. Till then, Galaxy S for life
  • Sad....I think they make the best Android phones and Samsung is killing them....
  • If it's removable battery and expandable storage that is your issue, you are a minority. It doesn't mean your concerns aren't valid, but the fact remains the average Jane and John along with grandma and grandpa out there likely don't have those features at the top of their list when it comes to choosing a smartphone. Marketing and carriers are the issue HTC needs to works out. Not its devices.
  • To me expandable storage is a big issue. It wouldn't be an issue if they had at least installed 32GB with the option to get it with 64GB. I think when their flagship device only has 11GB of storage available, that's a problem. That probably would have been ok 2 years ago but not for today's standard. Their other problem I believe is that they make to many phones. It becomes very confusing, none of them really stands out of the crowd and it becomes difficult to get accessories in time. I think the best version of the One X, is the EVO LTE, with expandable storage and a kickstand. I wish that would have been the only One x and have it available with all carriers. I personally was waiting for a nice htc phone to arrive at VZ when I wanted to leave sprint, but I was disappointed to find out that i didn't have expandable store so the DNA was dead on arrival for me. I had to force myself to get a samsung Phone, and that's not good for HTC.
  • Serves them well for bending over to apple.
    I hope they go bust.
  • I won't hope they go bust. They still make the sexiest phones IMO. I just got a One X, coming from an Amaze, and a G2 before that. I love how they feel in my hands. I hate what they did with Apple but I still support them. I've made a lot of compromise to stay loyal but I wish them a great 2013.
  • I respect that. Myself, I'll never, ever, buy anything from them, no matter how good their products are.
  • The best marketing is when a company makes devices that the consumers want and fall in love with them ant talk to everyone they know about it all the time. That's what apple did with the iphone and that's what samsung is doing with the galaxy. iphone 5 and galaxy s3 is what everybody is talking about, I hardly hear htc one x or htc evo or droid dna. No matter how good they try to market a product if it falls short of what people want. How can they make a super high end phone like the droid DNA and only install 16GB of storage of which only 11gb are available to the user, and no option for SD card? that in my opinion is totally reckless. Samsung is doing so good that even people like me who loves HTC phones just couldn't convince myself of getting the DNA because the option for SD card is important to me and I had to get the Verizon Note 2, which is a great phone but I still miss my EVO lte. I just think that HTC has to listen less to the carriers, and start listing to the consumers. If they keep doing what the carriers want and give the middle finger the to the consumers, then they will get what they deserve. Just make one or two great phones and make it available to all carriers HTC.
  • How about updating the HOX US and bring over the pogo pins dock.
  • Well, it could be worse, they could have lost money. Let's look at the upside.
    I've honestly always really liked HTC hardware, but I don't buy HTC anymore because of 2 reasons.
    Battery Life and Sense
    The hardware HTC builds is top notch and I've love to own one again, just for the build quality and superior cameras. But if they want to reinvent themselves they need to do two things in my opinion.
    Build razr maxx style phones, put huge freaking batteries in a fairly slim package, battery life is your major problem and honestly if HTC fixed only this and marketed their phones as having longer battery life they'd sell a lot more phones. Also make sense removable, even without rooting.
    I know their's a few sense lovers around, but most tech people I know hate sense, it's too bloated and too much of a memory hog. I know people may say that's only for tech people, but honestly how many of us bash htc when people ask what phone they should buy because we hate sense, again sense lovers need not reply to this, we know you exist, but more people hate sense than love it.
  • I've used several HTC phones over the years, starting with the HTC Mogul (oh god, the horror) and leading to the Evo 4G (WiMax), Evo 3D, and Evo 4G LTE. I have loved every one of my Evos, though the LTE had several glaring problems that HTC/Sprint never bothered to fix. They used to be known, at least to me, as the carrier and manufacturer duo that was super-fast to issue an update when there was a problem. I dealt with this most recent problem for several months before I went and got me a GS3 and I haven't looked back and won't.