HTC Posts Record Sales, Profit on Demand for Advanced Phones
April 08, 2011, 3:40 AM EDTBy Tim Culpan
(Adds earnings estimate in fifth paragraph.)
April 8 (Bloomberg) -- HTC Corp., Asia’s second-largest mobile phone maker, posted record quarterly profit and revenue on demand for more-advanced high-speed handsets.
Net income almost tripled to NT$14.83 billion ($513 million) in the first quarter from NT$5 billion a year earlier, the Taoyuan, Taiwan-based company said in a statement today. That was higher than the NT$12.8 billion average of 18 analyst estimates compiled by Bloomberg.
HTC, whose sales more than doubled from a year earlier, benefited from rising demand for smartphones that use Google Inc.’s Android system and models that offer higher connection speeds. Profit may gain further this quarter as the company begins selling new devices including its first tablet computer, according to analyst estimates compiled by Bloomberg.
“We expect HTC’s new model launches in the second quarter to drive stronger shipment growth than peers in the next two quarters,” analyst Jeff Pu, who recommends investors “buy” the stock, at Fubon Financial Holding Co. wrote in a report yesterday.
HTC said Jan. 21 it expected to ship 8.5 million units for the quarter, more than double that of a year earlier and its second-highest following the 9.1 million sold in the fourth quarter. It didn’t provide first-quarter shipment numbers today. Net income may climb in the second quarter to NT$14.5 billion, according to the average of 17 analyst estimates compiled by Bloomberg.
ThunderBolt Vs Iphone
Revenue rose to NT$104.2 billion, beating HTC’s own forecast for NT$94 billion, and surpassing the NT$95 billion average of 20 analyst estimates compiled by Bloomberg.
The company’s ThunderBolt handset, using fourth-generation high speed networks, equaled sales of Apple Inc.’s iPhone in 61 percent of the 150 Verizon Wireless stores surveyed by New York- based BTIG LLC, analyst Walter Piecyk wrote in a March 31 report. ThunderBolt outsold iPhone in 28 percent of stores, according to the survey.
“Several respondents indicated that the store lines were longer for the first day of the ThunderBolt launch than they were for the iPhone,” Piecyk wrote. “Verizon sales people indicated that sales of the iPhone were still strong but they simply noted that the ThunderBolt was as strong if not stronger.”
The Taiwanese company’s first tablet, HTC Flyer, was unveiled on Feb. 15. Sales will begin in the second quarter, rivaling Apple’s iPad and Samsung Electronics Co.’s Galaxy. Flyer has a smaller screen and higher-resolution camera than Apple’s iPad2.
Overtaking Nokia
HTC’s stock, which has tripled in the past year, fell 3.3 percent to NT$1,160 at the 1:30 p.m. close of Taipei trading before the earnings were announced. Its market value surpassed that of Nokia Oyj on April 6, putting it behind only Apple and Samsung, before dropping back below the Finnish rival in trading today.
Google’s Android operating system, which HTC uses for its handsets and tablets, will run on 49 percent of smartphones sold globally next year, from 39 percent this year and 23 percent last year, Stamford, Connecticut-based Gartner Inc. said in a statement yesterday. The software platform will stay ahead of Research in Motion Inc.’s BlackBerry, and Apple’s iOS, it said.
None of the 36 analyst recommendations compiled by Bloomberg advise investors to sell HTC while 29 say “buy” the stock.
--Editors: Vipin Nair, Anand Krishnamoorthy
To contact the reporter on this story: Tim Culpan in Taipei at tculpan1@bloomberg.net
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net
