After a string of losses, HTC posted its second straight profitable quarter. The handset maker used the same strategy in both quarters: Cutting costs in the face of slowing smartphone sales. That’s great for a quarter or two but not a solid long-term approach.
Reuters says HTC posted an unaudited net quarterly profit of NT$640 million (US $21 million) which is a sharp turnaround from the year ago period when the company lost NT$3 billion. That figure soundly beat analyst expectations of NT$216.23 million. Year to date revenue is down 13 percent, however, so cost cutting will only go so far.
The flagship HTC One M8 was fairly well received when it launched in April to compete with the Samsung Galaxy S5. Sales are trailing off now, however, at a time where the smartphone market continues to grow. Adding further pressure to HTC are Apple’s new iPhone 6 and 6 Plus handsets which already sold 10 million units in the first weekend of sales. To put that in perspective, HTC sold a reported 26.6 million handsets in all of 2013 across between its entire smartphone portfolio.
Ironically, a tablet could help HTC’s smartphone woes: [company]Google[/company] has reportedly tapped HTC to build the Nexus 9 slate, which could provide a needed sales and revenue boost going forward.