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HTC expects Q4 sales to hit NT$100 billion

2010/10/29 20:19:52

Taipei, Oct. 29 (CNA) Smartphone maker HTC Corp. predicted Fridaythat its sales in the final three months of the year would hit arecord high of NT$100 billion (US$3.26 billion) on strong globaldemand and eclipse the record it set in the third quarter.

The company also anticipated that sales volume for the fourthquarter would rise to 9 million units, also a record high, from 6.8million units recorded in the third quarter.

At a quarterly investors conference, HTC said third-quarter salestotaled NT$75.85 billion (US$2.47 billion), up 24.4 percent from thesecond quarter, and net profit rose 28.5 percent to NT$11.1 billion,yielding earnings per share of NT$13.61.

Monthly production capacity at its northern Taoyuan factoryreached 3 million units at the end of the third quarter and wasexpected to rise to 4 million at the end of this year to meet demand,the company said.

Smartphones based on the Android operating system have become ahit in North America and experienced growing demand in Europe, thecompany added, and it expected that demand in Europe would act as adriving force in expanding the company's sales from 2011.

Investors also have high hopes that China will help HTC reapmajor benefits after the company, one of the world's five biggestsmartphone makers, launched HTC branded handsets for the first timein July.

In the near-term, however, the company expected China'scontribution to sales would be minimal, but in the long-term, itexpected to gain from the fast-growing market, especially afterestablishing distribution partnerships earlier this year with threemajor Chinese telecom operators -- China Mobile, China Telecom andChina Unicom.

In the July-September period, HTC's gross margin stood at 30.2percent, and the company expects it will continue to maintain itsgross margin at above 30 percent in the fourth quarter.

TLG Asset Management analyst Arch Shih expressed doubts, however,that the 30 percent gross margin could be sustained becauseaccelerating price competition in the global smartphone market haseroded cell phone makers' bottom line.

(By Tien Yu-pin and Frances Huang)
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