HTC Corp. To Eliminate 15% Of Its Workforce

HTC has not disclosed where the majority of the job cuts will be coming from, but we imagine front-line manufacturing positions will be the first to go as sales of HTC smartphone continue to drop.

Samsung and Apple, which lead the pack, are aimed at the premium price point market, reflected in their dominance in wealthier countries such as the US or the UK. “HTC is on a losing streak as its research and development has failed to excel in high-end phones and its prices in low-end ones are not competitive enough”, said Masson Li, Taishin Securities Investment Advisory Co.

“Some of its rivals are hanging in there but you only have to look at HTC’s results to see they have had a desperate quarter”.

The company, which once was among the leading sellers of smartphones, has seen its fortunes declining for years.

Displays was another area that troubled many potential customers knowing that LG had already moved on to the QHD display, and Samsung was about to use the QHD on their new Galaxy S6, HTC continued to stay with the FHD display on their One M9. Today, its market share has dwindled down to less than a fifth of what it was, and the company is trying to combat this by breaking into new markets, such as gaming headsets.

“Mobile phones under US$100 would be most popular in the emerging markets. This could put Taiwanese companies under great pressure in terms of profit and market share”, said Eddie Han, analyst for Market Intelligence & Consulting Institute.

HTC hopes these upcoming products will generate meaningful revenue, but doesn’t expect this to happen until next year. Furthermore, Lenovo plans to launch newer models for its Motorola brand and has apportioned some $0.9 billion for clearing inventories and restructuring its smartphone business.