HTC's revenues decline by a massive 64% in Q1 2016

HTC's latest earnings figures continue to illustrate the manufacturer's downfall in recent years. The Taiwanese vendor posted an overall revenue of NT$14.8 billion ($463 million), a drastic 64% decrease from the NT$41.52 billion ($1.3 billion) it managed in Q1 2015. Operating loss for the quarter was at NT$4.8 billion ($150 million), a far cry from the NT$360 million ($11.6 million) profit recorded during the same period last year.

The manufacturer is now looking to the HTC 10 as well as the Vive to boost sales heading into Q2, with both products not accounted for in the first quarter earnings. Chairwoman and CEO Cher Wang said that HTC will continue to streamline and optimize:

We have been working hard to lay the groundwork over the past year, streamlining processes and optimizing resources to enable us to develop the best products in the most effective way.

HTC is betting big on virtual reality, and has invested $100 million to boost the VR content ecosystem.

Harish Jonnalagadda
Senior Editor - Asia

Harish Jonnalagadda is a Senior Editor overseeing Asia at Android Central. He leads the site's coverage of Chinese phone brands, contributing to reviews, features, and buying guides. He also writes about storage servers, audio products, and the semiconductor industry. Contact him on Twitter at @chunkynerd.

  • Their numbers should look alot better next quarter. The VIVE and the 10 are their biggest releases this year.
  • You'd think so. But for the past few years... each new flagship phone was supposed to return HTC to profitability. It hasn't worked yet. HTC believes they can break even on their smartphone business by Q3 of this year. Best of luck... it's a tough market out there. And I'm not sure an $800 "gaming accessory" will help either. Although the HTC Vive is an amazing device... it's a low-volume product. But hell... so are their phones. I don't think HTC even sells a million smartphones in a quarter anymore. A giant has fallen.
  • As for revenue it still should be better.
    The reason Q1 was so bad for them, is because they really didn't release or sell anything "new" in Q1 Posted via the Android Central App
  • A year ago at this same time... the M9 hadn't been released either. So it's similar in that regard. But even after the M9 was released... they still had 3 quarters of losses. I hear ya... new products generate sales and revenue. But a company needs profits too. And they haven't been making those lately. The M8 was supposed to save the company... then the M9 was supposed to save the company... and here we are again with thoughts about the HTC 10. We'll see.
  • Their main problem in my eyes, is the inability to have sustainable profits or healthy smartphone sales, in the long run. They seem to do OK for the first quarter post-initial launch, but after that things seem to trend downward rapidly. I hope it becomes clear that the 10 should not be blamed if HTC continues to incur losses. There are no improvements they could have done with the 10 that would make it sell well enough to sustain healthy profitable in the long run. IMO. Posted via the Android Central App
  • Sorry but you're wrong about the M9 not being released at this time last year. Just checked my order and my M9 was shipped to me on April 13 and I wasn't even early to the ordering party. You might want to do some fact checking next time.
  • +1 Posted via the Android Central App
  • Sorry jonathan3579... that's what the Engadget article said. My bad for repeating incorrect information. But if the M9 came out in April of last year... how many of its sales contributed to the quarter encompassing February, March and April? It couldn't have been that many.
  • Each flagship release has returned them to profitability apart from the m9 although it is slim margins. They do sell millions of smartphones but not nearly as many as apple or Samsung. I think the VIVE will have sold surprisingly well TBH. But we shall see, I do have doubts about the 10 being the hit they desperately need.
  • That's why it was a mistake to wait. Posted via the Android Central App
  • You really think the Vive is going to help at all? I don't. The 10 may help but I really don't see anymore people buying the HTC 10 than bought the M8 or M9.
  • Hopefully they pull it off this year. Moto XPE/VZW Moto X DE/N7
  • Yeah I do. But their are reasons to doubt that's why I put surprisingly well and the VIVE also seems like a high margin device. Even if sales are just OK that will be more then good for a company who is really struggling for sales like HTC.
  • I keep hoping HTC will eventually pull it out, but it just seems like a downward spiral.
  • There's an inappropriate sexual joke to be made here but I'm going to resist....
  • HTC are continuing their efforts to pull out of this current downturn. A frustrated Downturn could not be reached for comment.
  • Vive could save them, but 10 won't sell much. Only geeks are interested in 10.
  • Lemme guess, you own a Samsung? Posted via the Android Central App
  • Lots of people own lots of phones that are not made by HTC. That's the problem. HTC makes great phones... but so do 100 other companies. It's a fierce market. A crowded market.
  • LG.
    Next time, don't ass-u-me stuffs.
  • And next time don't ASS-U-ME that people who buy an HTC 10 are geeks. Posted via the Android Central App
  • Why are you ASS-U-MING that the geek term is used negatively here? Geeks tend to do their research when buying. For the average person when they go to a carrier store, they are either shown, iPhones or Galaxy phones and to a lesser extent LG stuff. The HTC area is usually tiny.
  • Hey if I'm a geek I don't care. Your right, "geeks" do tend to buy smarter. I've just got an HTC 10 and am no way a fanboy, though I had a Desire back in the day. The 10 deserves to do well though it's a great phone, though my 6P serves my needs better though I'm gonna give the 10 some time first. Posted via the Android Central App
  • The only way a phone deserves to do well is if it lives out to the expectation that HTC says it's suppose to be. If you look at a lot of HTC's problems they've failed to deliver everything that the consumer has wanted and HTC said they were going to give the customer. I don't think that they will recover with the 10 or the VR content. They should have been on the ball releasing the 10 back in March knowing that Samsung was releasing the S7 and S7 Edge. As well Samsung is going to be rolling out the Note 6 probably in the next two or three months. As for their VR products they are way overpriced at the current time in the current market. VR is very new to consumers and just really getting it's feet wet in the game.
  • LG stands for let's geek Posted via the Android Central App
  • Only geeks are interested in the 10 but the Vive could save them? Yeah, no. The Vive is as niche of a piece of technology as you can get. Geeks and nerds are the only people who even know about it.
  • Yep Moto XPE/VZW Moto X DE/N7
  • Hopefully making the next Nexus phones for Google will help them abit. Posted via the Android Central App
  • I'm hoping so, and thinking Google is trying to help throwing them a bone. HTC and Google better just make sure it still has Dual Front Facing speakers, kind of stupid for HTC to turn around on a good idea. And hopefully they keep a good quality camera again like the N6 and 6P
  • I'll be first to buy that Nexus - at 5in and VZW compatible Moto XPE/VZW Moto X DE/N7
  • My wife and I plan to go with the 10. It looks great and I like supporting HTC. Posted via the Android Central App
  • Yeah, I read up on that quite a while ago. Note that these are numbers before the H10 was released. By now, maybe it and the Vive would have helped quite a bit. Still hoping for HTC to pull through, even though the hole's probably dug too far now.
  • Well see if the htc m10 will help... Posted via the Android Central App
  • They need a new release schedule to try to match up more closely with Samsung and LG.
    If the HTC had been out when I got my s7 edge I may have considered it at the time. Posted via the Android Central App
  • But that would mean competing directly with the big boys and there's a danger they'll get drowned out. Posted via the Android Central App
  • Yes, but being able to have both in hand at the store can be a deciding factor which phone you buy.
  • Exactly. When you want customers to buy your products you have to be ready to compete with Samsung and Apple. That means getting your phones out at the time those to manufactures are selling them. Not wait until almost two months later.
  • Sure, because it made such a difference for them the last two years. They've done the same launch schedule, they've done the buy-on-launch-day and now they're shifting their schedule the other direction. I don't see how it could hurt. Posted via the Android Central App
  • Yes This reminds me of an old conversation of when starting up a small business.... "To succeed, you need to be first and you need to be unique. " I think there is some valid truth in that. Posted via the Android Central App
  • I don't believe that. The iPod wasn't first or unique. Neither were Google (search), the Samsung Galaxy smartphone, and the Tesla EV, although Palm and Blackberry were. The list goes on.
  • The iPod WAS unique how can you say that? Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • or a monster marketing/advertising budget! Posted via the Android Central App
  • OK and yes... But If your going to produce or sell a product after other similar types are out... I don't think your going to be hugely successful if your product isn't more than arguably marginally better than what's out there. Relying on brand loyalty I believe is a mistake. That's where marketing takes over. Posted via the Android Central App
  • The new one m10 isn't going bail them out. It's a matter of time before Samsung or LG buys out HTC. Posted via the Android Central App
  • Agreed. That's not a knock against the 10, but I don't see it being able to generate a sufficient volume sales so long as it doesn't have an Apple or Samsung brand on it. Posted via the Android Central App
  • What about Google? They could buy them just to make Nexus stuff Posted via the Android Central App
  • Maybe to get their patents and then sell them off again like they did with Motorola.
  • Exactly. And it will be to another Chinese company like lenovo that abandons it with no updates.
  • Why would they? Samsung can already put together a better phone.
  • LOL, nice joke.
  • Apple could buy HTC. Posted via the Android Central App
  • I really hope HTC gets back in the game. I've lost faith in Motorola since they are under the Chinese influence now. I can't bring myself to use Samsung's software, no matter how beautiful the hardware is. LG is not an option at all. As much as I like stock android I'm not the type to root and rom so the Nexus isn't in my future right now although that could change. SN: I really hope HTC finds a new distributor because Digital River is not it.
  • You don't know what you are missing. Posted via the Android Central App
  • Let's start up a distribution center....we'll call it....analog lake! Lol
  • HTC needs to stop with phones, they can concentrate on VR but their not competitive enough in the upper or lower tier phone market to warrant staying in business on that side anymore. And before any HTC fan girl goes off on me about the quality of HTC devices, it's not that they make bad phones....but their business practices surrounding those phones is God awful (marketing, advertising, availability, I can keep going). If HTC wants to won't be in the phone space...there's too many other players doing it better, cheaper and with more success.... Posted via the Android Central App
  • I honestly don't see HTC being able to avoid what appears to be an inevitable collapse. If people want to believe that their products are what have put them in this predicament or can pull them out of it, then that's fine, but hardly the case. I believe HTC's goose was cooked pretty much after Samsung legitimized themselves as a viable alternative to Apple products in the eyes of the general consumer (i.e., non-tech enthusiast). If the speculation of the smartphone market slowing are true, then HTC doesn't really have any market share left to compete for and will be squeezed out the market. All my opinion of course. Posted via the Android Central App
  • As much as I love HTC, I think you are correct. I'm hoping that google foresaw this and is why they sold Moto to Lenovo. They can snatch em' up if the OEM can't make it on their own. I would hate to see HTC smart phones non existent in the market. The ego did not post this
  • Why would Google care at this point? What exactly is HTC bringing to the table for Google? As bad as Moto had it, at least they had patents, something HTC is sorely lacking. The few talents they had are gone, so my question is what exactly would Google be buying at this point? Business come and go, it just so happen it's HTC turn circling the wagon.
  • I feel like HTC has a brand recognition that is not bad. Sure, they don't have the recognition as Samsung or Apple, but I know a lot of people that used to love their HTC phones, but just felt that Samsung and Apple were ahead of them in terms of quality and innovation. I think that could be reversed given the correct move (such as being sold to Google). However, it would be a huge risk which most likely would not work out well.
  • I don't think HTC brand is as well known as you seem to think outside of the tech sector. Google just hired Rick Osterloh to create a new hardware division, if HTC could help, I am sure they would picked it up on the cheap but they did not. At this point, HTC have too much legacy from the past in trying to compete in this new world where being small and nimble is the way to success. In the current android market where costs is what everyone competes on then you either need scale or be small enough to keep your costs down. HTC have neither in their corner at this point, shame.
  • HTC has a nice patent deal with Apple that nobody else does. I'm sure that little morsel might be tasty to Google. Posted via the Android Central App
  • Sadly, you might be right.
  • The real reason that HTC started to fail is that Samsung paid people to post negative comments on the HTC site. This severely damaged HTCs reputation,from which it never recovered. Posted via the Android Central App
  • You know they have the nexus' for 3 years right?
  • Interesting observation Posted via me
  • How much has it spent to boost brand recognition? Because without that, all the streamlining in the world isn't going to sell products. Posted with my LG G4 6.0 via the Android Central App
  • It's a shame the 10 came out so far after the S7. If I hadn't already plumped for the S7 I think it may have been a contender. On the upside though I think LG may have done them a favour, I've got a feeling the G5 isn't going to do that well. I used to love HTC phones and I'm rooting for them to get back in the game. The VR space is in its infancy and I doubt that the Vive will do much for them this year but from what I've read those who have reviewed it seem to think HTC have nailed it. If they've invested in it this could become a real cash cow in future years as prices come down and VR becomes more main stream. Let's hope they can hang in there long enough. Posted via the Android Central App
  • I don't know how HTC can continue on at this pace. Eventually the money runs out.
  • I would have contributed to the sales by getting the new HTC phone, however they chose to release it through Bell Canada I will be looking for a healthy alternative phone for my upgrade...your loss HTC, not mine!!! Posted via the Android Central App
  • Me as well. I went with the S7E.
  • Guess that means I can get a HTC 10 pretty cheap in a few months as a backup for my 6P. It's a great device and a improvement from the M9 for sure but they seem to dig themselves deeper ever year since the M7. I don't think the Vive or HTC 10 is enough to save them. Posted via my Nexus 6P.
  • That was not really HTCs decision. I think the other carriers have no faith in this phone's ability to generate profit for them. They may be right. Posted via the Android Central App
  • Only in business, "Guys, we only made $463 million in this past 3 months, we are failing" Posted via the Android Central App
  • That's revenue, not profit. They actually lost $150million in Q1. You can't stay in business for very long losing $150mil per quarter, no matter how high your revenue is.
  • You are correct, I misread it. Posted via the Android Central App
  • More important than the revenue is the operating loss of $150M. Compare that to the previous years Q1 profit of $12M and you see the problem: that's 3 years worth of profit(if that quarter is typical) wiped out in one quarter. Can't do that too much
    Edit: ninja'd by oryan
    Posted via the Android Central App
  • That was just revenue. They lost $115 million on that. So they would have needed to pull in $578 million just to break even. Posted via the Android Central App
  • Without advertising, especially in today's saturated smartphone market it's a tall mountain to climb for HTC, I have not seen one add of their new HTC 10 device anywhere, Samsung and Apple are plastered everywhere, from billboards to commercials. And with consumer spending down, and no reason anymore to keep upgrading to the latest and greatest, since most phones out there even two years old still meet the needs of most consumers. Posted via the Android Central App
  • Jimbo! Where are you? Did you secretly ditch htc and move to samsung? Lol
  • Hell no.
    The last thing I'd want to do is fumble around like you do with that glitchy, grimy, slippery thing. I understand that's you. For me the HTC 10 is the best flagship for 2016, the G5 a worthy competitor, and the upcoming Nexus 5 and 5.5 should also be great smartphones. The Samsung and Apple marketing machines and their singularity of brand awareness among the mass market doesn't make their products the very best even though it makes them best sellers. Just as your wife will understandably prefer play with her 10 instead of your edge.
  • Lol!! She plays with my "edge" like a pro!
  • Good for you. There definitely are certain redeeming values in having a pro handy when you need one. Reviewers have been saying the edge is slippery and can get a bit filthy.
  • Lol! She can make slippery while being a bit dirty!
  • This is reminiscent of what happened to Palm. Great devices. Lost the battle to Apple and Samsung (and HTC).
  • Years of negligence brought this on year on year people complain about the same thing and they ignored it until people voted with their wallets and moved to another OEM my first smartphone was htc desire so i have real soft sentiment spot for HTC i really do but the desire was my last HTC phone because to me that was their best phone l until the HTC 10. I looks grim for them i doubt they will pull through to be honest. Posted via the Android Central App
  • I'm hoping they do well. With the release of the 10, I'm hoping their earnings and revenue will shoot up. Posted via the Android Central App
  • this year the only problem here is they don't have att, the biggest GSM carrier as their partner Posted via the Android Central App
  • Their stock valuation from about a year ago already showed this company is a dead man walking. The stock price only included their cash as assets, ignoring the company, any goodwill left, inventory, buildings, and manufacturing.
    Prime for a takeover except there is no reason to do so since this dead pony is just on its March to the glue factory.
    Anyone willing to buy their phones or the Vive better start worrying about future updates and support soon... And why buy 10 when you can get a Robin for $299 or a bunch of others in the $3-400 range? Days of $600-700 flagships have ended me thinks... Posted via the Android Central App
  • I will never forget the M7! dreaming of electric sheep
  • I'm responsible for 2 unsold M10s this year, sorry about that. They are great phones, I've had a HTC since the EVO 3D up until the M9, but got tired of being on the weirdo wearing Transition Lenses. (That's my analogy of being the odd man out with a HTC device)
  • Just chiming in with my 2 cents worth. Read most of the comments and they have a near sighted first world field of vision to what requires a global perspective. It's a numbers game and try as it might HTC does not have a chance. 1. N.American markets are locked down between the big players Apple and Samsung and the carriers. Apple and Samsung have the marketing muscle and brand image to stick it to the carriers and have their products placed as push to sell products. Everyone else is bullied by the carriers who force suppliers to subsidise handset prices if they want to be part of a carriers product portfolio leaving handset makers with razor thin margins. 2. ROW has a more level playing field with contract free - full price handsets being the normal and contract subsidies being a smaller market segment. But again it's a bloodbath out there because err the Chinese are coming. Top tier flagship 's are getting challenged everyday by some very good handsets coming from what were (and still are up and coming) Chinese brands. 3. The likes of Sony and LG have handset divisions hurting real bad but they are huge conglomerates with very deep pockets so they can afford to slug it out for a bit longer. Even lesser known (non-Chinese) producers like Asus can sustain a handset business for longer because it's one of many product lines in a large portfolio. HTC on the other hand is like Palm - a specialist hand held device producer (the Vive is a niche product) and if this line of business starts to squeeze their profits they are toast. 4. The near future will see fully integrated Chinese players from chips to devices offering handsets as commodities leaving little room for smaller, specialist outfits to compete. They have one advantage others don't : a local domestic market with a few hundred million users at their doorstep, Chinese state owned carriers (China Mobile, China Unicom, China Telecom) through which subsidised distribution will always be a steady revenue stream for local handset producers (on preferential terms versus overseas producers). Access to another billion plus price sensitive users just across the Chinese borders - India, Indonesia, Malaysia, Thailand, Malaysia - to name a few, where mid range wannabe flagships will outsell top tier flagship 10:1. More handsets sold in these markets and price range means even better economies of scale and more competitive pricing. In the last five years the top five handset sellers have seen every other brand being pushed back into oblivion except for the 2 biggies I named earlier. Get used to reading names like : Xiaomi, Huawei, Lenovo, OnePlus, Oppo, Meizu, LeEco, Vivo - these are growing multi-billion dollar corporations and just a few names I've rattled off from memory. In the local Chinese markets there are another dozen or so second tier producers who are already making life difficult for some of these top tier producers. And then there are still the tier three producers to reckon with who are the so called "OEM suppliers" who churn out made to order cheap smart phones for anyone from Alcatel to Micromax or Karbonn, basically anyone who walks to their doorstep with an order of 5000 pcs to get a "custom made" branded smart-phone. I have held a few such smartphones in my hand and shook my head in disbelief when told that unit price is a full 40' container load of these devices is between USD 20-25. They are not flagships 's or even mid range devices but yet they are fully functional smartphones running Android 5. So the markets you can imagine are brutal. Small companies (relatively speaking) like BlackBerry and HTC can make fantastic, ground breaking handsets but their handset divisions are liabilities which will follow the same path as the Palm's, Motorola 's and Nokia 's of years gone by. They have already lost the numbers game. They can at best exist for a while as niche, marginal players or maybe get taken over by the likes of Amazon or Facebook as delivery agents of a completely different business hooked to "alternative" revenue streams aka Albhabet's Google-Android. Posted via the Android Central App
  • Great post!!
  • Seconded
  • I wouldn't read too much into it. Dead companies can stick around for a long time. Blackberry is probably the best example in the mobile space.
  • Blackberry has a revenue stream going from its software and services division. The hardware division is on its last legs. They my still manage to keep it afloat as long as the hardware does not burn through their cash - just so they have a platform available to offer a fully "secured" hardware + software solution to some enterprise clients. But on the consumer front they have practically stopped making an effort. HTC does not have this luxury to fall back upon. Palm was probably way ahead of its time with webOS (first to market with a real cloud leveraged OS, a well thought out notification and multi tasking UI which iOS and Android borrowed heavily from and took years to fine tune, wireless induction chargers for phones and tablets, seamless bridge between the phone and tablet for calls and messaging ) but when lack of traction did not trigger the incubation of an ecosystem and the sales figures did not add up to support continued development they folded. Of course Apple lent a willing helping hand in expediting their demise by ensuring that US carriers will keep the Palm products properly wrapped up, away from the consumer's eye. HTC's downhill run is being expedited with the emergence of the Chinese players who are redrawing the boundary lines of the smartphone game plan. HTC played a good game back in the day when the rules were different - today they are a fish out of water gasping for every last breath. I love some of their very well designed products and would hate to see them go but........ Posted via the Android Central App
  • HTC needs to stop putting all their eggs in one basket. It is clear they are bring outperformed by Samsung and other android manufacturer. I I personally feel they should branch out and maybe work on Windows products. Bring something new and innovative there and maybe capture the hearts of new fans and markets Posted via the Android Central App
  • Right, cause combining two sinking ships will make a winner.
  • ^ +1 Posted via the Android Central App
  • I agree. But with MS's cash flow they could sustain for quite a while. But like you said.....ain't happenin'.
  • The 10 is the best mobile device they have ever made, I see them pulling out and maintaining competitiveness but very slowly. I don't think they are dead yet Posted via the Android Central App
  • With no effective marketing and mind share, they are.
  • Well, I hope they continue to make phones and have some success in the upcoming quarters. And I'm considering the 10 or a Nexus.