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HTC begins new chapter following deal with Google

2018/01/31 21:01:58

Taipei, Jan. 31 (CNA) 2018 could be a decisive year in the ambition of Taiwanese smartphone and virtual reality (VR) device maker HTC Corp. to be the top business in the global VR, augmented reality (AR) and artificial intelligence (AI) sector, now that its financial difficulties have received a boost from a deal with U.S. tech giant Google Inc.

In a letter to company employees published Wednesday, HTC Chairwoman Cher Wang (王雪紅) said the company started its new chapter that day after its cooperation deal with Google, signed in September 2017, took effect a day earlier.

The deal "lets HTC gain strength in pursuing growth in the new technology arena, helping it to create a bright future," Wang wrote in the letter.

She further said that this year, HTC will accelerate work to promote its strategic goals. "Since smartphones will be undoubtedly consumers' first contact with 5G, the true killer apps in the 5G era will be VR, AR and AI," Wang contended.

After years of development, Wang said she expects HTC to take the lead in the sector, thanks to its "VIVE Reality." VIVE is the brand name of the company's VR devices.

On Tuesday, HTC completed its deal with Google, under which certain HTC employees -- many of whom are already working with Google to develop the latter's Pixel smartphones -- will join Google.

In return, HTC receives US$1.1 billion in cash from Google as part of the transaction. Separately, Google receives a non-exclusive license for HTC's intellectual property.

Thanks to the deal, HTC is expected to add NT$40 (US$1.37) in non-core business income to the company's earnings per share. This will possibly help the company report earnings in the first quarter of the year, according to market analysts.

In the third quarter of 2017, HTC posted a loss per share of NT$3.8 (US$0.13), registering a net loss for the 10th straight quarter.

After the announcement of the implementation of the deal with Google on Tuesday, HTC shares rose 1.71 percent to close at NT$71.40 on the Taiwan stock market, which ended 1.29 percent lower at 11,076.78.

On Wednesday, Google kicked off a two-day event at HTC headquarters in New Taipei's Xindian District to greet its new employees with a series of briefings, including information about the company's history and business culture.

(By Chiang Ming-yen, Jeffrey Wu and Elizabeth Hsu)
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