HTC to cut jobs and discontinue smartphone models

HTC plans budget phones

Hit by rivals – Apple, Samsung, Huawei and Xiaomi — HTC is planning to eliminate jobs and discontinue smartphone models.

The Taiwanese smartphone maker, as part of its new strategy, will focus on high-end devices to better compete with Apple and Samsung Electronics.

Recently, Microsoft, which acquired the Nokia phone business unit, announced the elimination of around 8,000 jobs across the world.

“The cuts will be across the board,” Chief Financial Officer Chialin Chang told reporters after HTC reported a second-quarter loss and forecast another for the third-quarter. “They will be significant.”

HTC does not share specific details why should the high-end models fetch new business to the ailing company. Incidentally, the company is not considering any merger with rivals to revive the company and its innovation capabilities.

Chang said the cost reductions would extend to the first quarter of next year, but declined to give further details.

HTC forecast a quarterly loss, driven by plummeting sales as the smartphone maker cedes market share to Xiaomi and Huawei Technologies, two Chinese smartphone brands.

Third-quarter loss of HTC will be NT$5.51 to NT$5.85 per share. The projection for sales will be NT$19 billion ($600 million) to NT$22 billion. For comparison, HTC’s quarterly sales topped NT$135 billion just four years ago.

The company has been losing market share over the past few years, hit by intense competition at the high-end of the market from the likes of Apple and Samsung Electronics while budget Chinese rivals have also eclipsed its low-cost offerings, Reuters reported.

Chang said HTC was relying on selling high-end smartphone models in emerging telecom markets such as India, where he said the company has a 20 percent market share of phones priced between $250-$400. Recently, Samsung said it has 38 percent share of India’s phone market.

Baburajan K
[email protected]