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HTC shares plunge as April sales dip to new low after IPO

2019/05/07 16:24:58

Taipei, May 7 (CNA) Shares of Taiwan-based smartphone brand HTC Corp. took a beating Tuesday after the company reported disappointing sales data for April a day earlier, which dipped to a low since the company launched an initial public offering (IPO) in March 2002, dealers said.

Soon after the local equity market opened, HTC shares came under heavy pressure as market sentiment was hit by the sales figure, and the weakness continued for the rest of the session to close down 5.54 percent at NT$39.20 (US$1.27) on the main board.

Due to the April sales, the stock underperformed the broader market, where the benchmark weighted index ended up 0.83 percent at 10,987.14 points on a technical rebound from a 1.80 percent dive a day earlier.

HTC said its consolidated sales for April stood at NT$590 million, down 55 percent from a month earlier and also down 71 percent from a year earlier.

In the first four months of this year, HTC posted NT$3.54 billion in consolidated sales, down 67.52 percent from a year earlier.

"The April sales provide further evidence that HTC remains submerged amid escalating competition in the global smartphone market, and at present, there is no sign of when the company will make a turnaround," Concord Securities analyst Kerry Huang said.

Despite HTC's launch of its first Blockchain phone -- the HTC Exodus 1 -- in the fourth quarter of last year, April sales still appeared disappointing.

In March, HTC saw its consolidated sales doubled from a month earlier to NT$1.31 billion, and said that the increase reflected its efforts in virtual reality technology development after the company introduced more follow-up VR headset models such as the Vive Pro Eye and the Vive Focus Plus after the launch of its first VR headset -- the Vive -- in 2015.

The Vive Pro Eye, a revised version of the Vive Pro, is equipped with eye-tracking hardware and is an upgrade of the Vive, while the Focus Plus is equipped with two "6 degrees of freedom" (6DoF) controllers. With its improved graphics, the device is ideal for showrooms, training simulations and virtual conferences, according to the company.

The month-on-month surge in sales for March also reflected the higher number of working days compared with February, when the nine-day Lunar New Year holiday fell, market analysts said.

"The VR operations still account for a small fraction of HTC's total sales, so it remains to be seen when the VR development efforts will give a significant boost to the company's sales," Huang said.

According to HTC, it will unveil its new flagship smartphone model, as well as its second-generation Blockchain phone, in the second half of this year.

The second-generation Blockchain phone will carry applications for cryptocurrency transactions, like the first-generation device, and will also allow digital asset management, HTC said.

(By Jiang Ming-yan and Frances Huang)
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