HTC’s awful run in 2012 shows no sign in letting up in 2013. The phone-maker might say that its latest results have helped ‘consolidate’ its position, which may be true considering how bad things looked at the end of last year.
But there’s no hiding from the fact that profits slid by a colossal 90 per cent compared to the same quarter in the previous 12 months.
Throw in its prediction that profit margins could sip as low as 0.5 per cent in the first three months of this year, down from 1 per cent in Q4 2012, and things couldn’t look much worse for a company that just two years ago was slaying all before it.
The question now is, with the HTC M7 due to launch in a couple of weeks and plans for a string of new budget handsets in China, can HTC get back to its previous position as Android top dog?
The answer, surely, sadly, is no. Much of it comes down to marketing spend. Samsung and Apple are forking out billions in their attempts to persuade smartphone owners to part with their cash for their latest kit.
As HTC’s profits go into freefall, the money available to spend on such activities is decreasing, hence its inability to land a punch on mobile’s two biggest hitters.
It’s a vicious circle that even a phone of such potential as the five-inch M7 cannot break. HTC has said it’s working on “a more exciting product lineup” in the next few months, with budget phones at the centre of its plans.
China’s nascent smartphone market is the prize, an area where it feels it can clean up.
But competition comes from all directions in one the world’s last remaining untapped smartphone markets.
ZTE and Huawei are both storming ahead, as is the ever-present Samsung.
Throw in the inevitable launch of a plastic, budget iPhone later this year and it’s hard to see where HTC is going to boost its margins and get back to making the megabucks it was in early 2011.
In trying to differentiate itself with HTC Sense, the company has also given rise to complaints that its phones come laden with bloatware.
While accusations that its phones don’t get Android updates as quickly as others is unfair (Samsung and Sony are just as guilty in the wider issue of fragmentation of Google’s OS), it’s an image the company is struggling to shake.
Throw in some serious hardware failures, with myriad issues with the once-flagship HTC Sensation especially, and you can see why consumers are voting with their feet.
HTC has made some of the smartphone era’s best devices - its original Desire was a game changer and the One X is a great handset.
But without the ability to match marketing spend and a growing band of rivals offering similar, cheaper phones, HTC’s days at the top table look numbered.