HTC sales drop 60% in October. Unless HTC 8X and 8S Windows Phones save the day, profit warning is coming

HTC has posted their monthly sales for October. And it’s their biggest yearly drop in revenues, probably ever. A whopping 60%.

HTC has sold $NT 44 billion ($1.5B) worth of smartphones in 2011. This year? October numbers came in at $NT 17.2 billion ($588 million).

With one month in and two to go in the fourth quarter, and $NT60 guidance for it, HTC is already 14% short of the goal. And, if history is any guide, the next two months wouldn’t be much better. We may be looking at another profit warning in a few weeks.

Unless the new Windows Phone 8 HTC 8X and 8S somehow manage to save the day. Which I doubt will happen.

Steve Ballmer, Peter Chou and Stephen Elop might be talking good game, and the device reviews could be very positive – but Windows Phone 8 just doesn’t seem to be quite there yet, to generate a big sales splash and compensate for HTC’s losses in Android.

We’ve also heard the same song with great reviews, “huge pre-orders”, etc; from a Windows Phone camp led by Nokia, a year ago. Which translated into less than 1 million actual devices sold in Q4 2011. The best quarterly Windows Phone sales came in at 4 million units, on the backs of heavily discounted Lumia 710 and cheap 610. But that was in Q2, before 30% drop in Q3.

To turn things around this quarter, HTC will have to sell at least several million of 8X and 8S, before the end of the year. And I don’t think it’s possible. Between Windows Phone’s major lack of consumer acceptance, and having to share whatever sales there are with Nokia, I just don’t see HTC moving millions of WP8 devices in the 9 weeks they have left in Q4.

It seems that HTC got screwed by new iPhone launch this year again. All their troubles last year started in November 2011, just after the launch and widespread availability of iPhone 4S. This year, iPhone 5 came a month earlier, and we have a huge drop in HTC’s income, also a month before it happened last year.

To be fair, this time around, with new Windows Phones, HTC One X+ and HTC J Butterfly phablet – they may have a bit more interesting portfolio for Christmas Shopping Season. But the key word here is a bit, with nothing major.

Which is hardly enough going against Apple, Samsung’s marketing juggernaut, strongly improving products from Android competitors like LG and Sony, and the onslaught from Chinese vendors like ZTE, Huawei and Lenovo.

Author: Stasys Bielinis

While I like to play with the latest gadgets, I am even more interested in broad technology trends. With mobile now taking over the world - following the latest technology news, looking for insights, sharing and discussing them with passionate audience - it's hard to imagine a better place for me to be. You can find me on Twitter as @UVStaska'

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  • casualsuede

    the problem isnt the product line per se, it is their communication, marketing and advertising strategy. it is non-existant