Taipei, Sept. 9 (CNA) Shares of Taiwan-based smartphone brand HTC Corp. moved higher and outperformed the broader market Monday as investors took cues from a more-than 66 percent month-on-month increase in sales for August, dealers said.
However, investors were advised to remain cautious about escalating competition in the global smartphone market, with market analysts saying that single-month sales do not mean that the brand has left its long-term sales doldrums behind.
Shares of HTC opened up 0.97 percent on the back of its strong August sales report and buying accelerated to push up the stock by 1.52 percent to close at NT$36.75 (US$1.17) on the Taiwan Stock Exchange, outperforming the main board, where the benchmark weighted index ended up 0.19 percent at 10,801.14 points, dealers said.
The August sales figure prompted investors to buy into the stock, boosting turnover to 6.59 million shares Monday from 5.74 million shares Friday, the dealers added.
"Today's gains totally reflected the smartphone brand's August sales after investors rushed to hunt bargains soon after the local equity market opened," Dayu International Securities Investment Consultant analyst Chang Chih-cheng said.
In a statement released Friday, HTC said it posted about NT$730 million in consolidated sales for August, up 66.8 percent from July, when its revenue plunged nearly 70 percent from the previous month, marking its lowest monthly revenue since March 2002.
On a year-on-year basis, however, HTC's consolidated sales still fell some 47 percent from a year earlier, company data showed.
In the first eight months of this year, HTC's consolidated sales stood at NT$6.93 billion, down about 62 percent from a year earlier, further evidence that the brand remained bothered by stiff global competition.
Commenting on its August sales report, HTC said the month-on-month spike resulted from its efforts to promote its smartphones and boost the global visibility of its virtual reality development.
During the summer vacation, HTC launched a series of promotional campaigns for its smartphones, including a check-up for select models and trade-in sales, a move that pushed up its shipments in August.
In addition, HTC said its VR development also contributed to its August sales.
HTC entered the virtual reality market with its first VR headset, the Vive, in 2015, and later follow-up models, in a bid to assuage the impact of the rising competition in the global smartphone market, not only in the high-end segment but also in the low- to mid-range segment.
In addition to the VR hardware production, HTC also serves as a VR content provider, while it has extended its VR efforts to film production. Its VR work even attracted attention at the 76th Venice Film Festival.
"HTC did not disclose any details about the sales proportion of its VR headset, but I think the VR operations only accounted for a small fraction of its total sales," Chang said.
Chang said HTC shares could see strong technical resistance ahead of the NT$38 level after Monday's upturn.