HTC experienced massive losses during the First Months
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HTC’s revenue numbers continued to drop massively between January and March 2019, and to no surprise today the company has confirmed that it experienced massive financial losses throughout the period.
Despite seeing an improved gross margin of 14.7% during the quarter – a year earlier HTC’s gross margin was -3.1% – the Taiwan-based company still experienced a worse-than-expected loss of NT$ 2.73 billion ($87.68 million). The primary cause of this huge loss was HTC’s operating expenses, which essentially skyrocketed throughout the first three months of the year. In fact, within the space of 12 months, the company’s operating margin has gone from an awful -58.9% to an absolutely horrendous -92.9%, which means, at the moment, HTC is spending almost double what it earns.
Overall, the company generated NT$ 2.94 billion ($94.45 million) in revenue throughout the quarter. The strong performance of HTC’s VR headsets appears to have been the primary source of income, although the company’s smartphone sales did also play an important role.
Looking towards the second quarter of the year, HTC’s newly-announced Exodus 1s blockchain smartphone and the HTC 5G Hub are expected to positively affect the company’s finances. Both the Vive Pro Eye and Vive Focus Plus headsets are set to boost HTC’s sales too, all of which will lead up to the company’s 5G flagship during the second half of the year, as well as a couple of mid-range smartphones.
Questions & Answers
Q.What was the main reason for HTC's significant financial losses in the first three months of 2019?
What was the main reason for HTC's significant financial losses in the first three months of 2019?
The primary cause of the huge loss was HTC’s operating expenses, which increased dramatically throughout the first three months of the year. The company's operating margin worsened from -58.9% to -92.9% within 12 months.
Q.Which product lines were the main contributors to HTC's revenue during the period?
Which product lines were the main contributors to HTC's revenue during the period?
The strong performance of HTC's VR headsets appears to have been the primary source of income for the company. Smartphone sales also played an important role in generating revenue.
Q.What new products does HTC expect to improve its financial situation in the second quarter?
What new products does HTC expect to improve its financial situation in the second quarter?
HTC anticipates that its newly-announced Exodus 1s blockchain smartphone and the HTC 5G Hub will positively affect its finances. The Vive Pro Eye and Vive Focus Plus headsets are also expected to boost sales.
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