HTC profits slump 91% after delay in launching its new smartphone

Further signs that competition in the mobile phone market is brutal emerged today with the latest results from HTC.

Its profits in the first quarter slumped 91% compared to last year, a fall blamed on the delayed launch of its new flagship smartphone.

The Taiwanese manufacturer has struggled against the dominance of Samsung and Apple in the smartphone market, and with the emergence of Chinese low-end market rivals.

In the three months to March, profits were just 85 million New Taiwan dollars (£1.8 million) from NT$1 billion a year earlier. Revenue fell 36.9% to NT$42.8 billion from NT$67.79.

Analysts and investors are pegging their hopes on the HTC One smartphone, the launch of which was delayed due to a shortage of the phone’s camera components. Daiwa Securities analyst Birdy Lu said: “HTC was thrown into disarray because of the HTC One, without revenue coming in but a lot of fixed costs. This quarter there will be some improvement in the bottom line, but still a lot of competition.”

HTC has also announced a smart-phone in collaboration with Facebook.