As of June 2018, HTC's global workforce totaled approximately 6,450, and the layoffs were close to one-quarter.
The outside world speculated that HTC was trying to reduce costs. According to HTC's first-quarter earnings report, HTC's revenue in April this year fell 55.4% year-on-year, and sales in March fell 46.7%, attracting complaints from many shareholders.
"The reasons for the weakening of HTC can be summarized as the loss of the patent war and the mistakes made in the market decision." An analyst who did not want to be named by Jibang Technology told the First Financial Reporter that this year we estimated the production of HTC. (smartphones) will be at a production level of less than 2 million units. Last year, IDC data showed that as of September 2017, HTC's market share was only 0.68%. Jibang Technology expects HTC's smartphone shipments to be less than 10 million units during the year.
Mobile phone business continues to fall
According to HTC founder Wang Xuehong's previous "commitment", HTC will certainly bring satisfactory results to shareholders in 2018, but now halfway through, HTC's transcripts are not satisfactory.
As one of the earliest manufacturers to bet on the Android system, HTC once occupied 9.1% of the total global smartphone shipments, and the sales volume of 43 million or so made it the "king of Android" reputation. However, with the mistakes in strategic development, this brand that once competed with Apple and Samsung is now declining.
HTC's financial report shows that in the first quarter of this year, HTC's revenue was 8.8 billion Taiwan dollars (about 1.88 billion yuan), with a loss of 5.2 billion Taiwan dollars (about 1.11 billion yuan). In the fourth quarter of last year, HTC's operating income was NT$15.1 billion, down 29.3% year-on-year, and operating loss was NT$9.6 billion, up 1.7 times year-on-year.
With a price of NT$1,300 per share, HTC once won the “Taiwan Stock King”, but now the stock price has fallen by 95%. Such market performance has attracted constant complaints from shareholders.
"HTC has entered the US market with innovation. It was once the most popular mobile phone in North America. However, with the rapid rise of high-end smart phones Apple and Samsung in recent years, there are domestic manufacturers in the low-end and smart-end products. Wang Yanhui, secretary-general of the China Mobile Alliance, told reporters that HTC is facing problems in its overall positioning as it enters the global era of smartphones.
An analyst of Jibang Technology, who did not want to be named, told reporters that after the RD department was traded, the frequency of HTC's launch of new machines was reduced, and the flagship machine was not selling well, resulting in the market share being continuously compressed.
It is reported that in September last year, HTC has packaged its team that participated in the Google Pixel mobile phone business to Google, which sold for $1.1 billion. About 2,000 HTC employees have joined Google. However, it is widely believed that this transaction has not improved the HTC's profitability.
According to HTC officials, the layoffs are mainly concentrated in the manufacturing sector in Taiwan. According to HTC, the company's market and production demand show seasonal and market changes, and it has been constantly reviewing human resource allocation to ensure that capacity is in line with market demand. In other words, the layoffs will make HTC's production capacity have a large decline.
Regarding the performance of the mainland, Wang Xuehong once admitted that compared with Samsung, HTC did not accurately convey the characteristics and differences of products to consumers. It is a fact that it is not well done. In the future, HTC will adhere to the true nature of innovation while “taking the masses to promote innovative routes.”
However, from the market performance of HTC in recent years, in addition to the gains in the VR field, the mobile phone business has not improved. According to statistics from QuestMobile, a third-party research organization, HTC's share in China's smart terminal market fell to 0.4% in 2017, ranking 12th in the industry.
"In the face of fierce competition in the smart phone market, the proportion of cost (BOMcost) continues to increase, the brand's use of compressed profit margins to achieve market share, resulting in the survival of small brands is more difficult, and whether HTC has the ability to maintain the established plan, still said Early." The above-mentioned Jibang technology analyst told reporters.
And you can see that the competition for smartphones has already shown the Matthew effect.
The model of Apple and Samsung in the head enterprise cannot be easily copied. Brands such as HTC, Sony, and LG have the pressure of high-end products, and there are domestic mobile phones that are not chasing and blocking. In the low-end market, there is no cost advantage. Brands such as Nokia, Motorola, and Blackberry, which have been smashed in the global market, have already injected “Chinese Genes”, and production or sales have been handled by Chinese companies.
"In terms of the penetration of the channel, brands like HTC have no chance at all, and the slow response to the policy has created the situation today." Wang Yanhui told reporters.
However, in the current situation of Jibang technology analysts, HTC still has the ability to innovate research and development, such as 5G theme or AI theme may be the next development direction of HTC, but from the development of new business such as VR The short-term economic scale is very limited, and it is very difficult to be the main source of revenue to support HTC.