HTC reports 68 per cent profits surge

TAIWANESE SMARTPHONE MAKER HTC has announced staggering third quarter 2011 results with a 68 per cent increase in profits.

HTC's range of smartphones has powered the firm from little known also-ran to a big player in the smartphone market. The company, which for many years would not even market devices under its own name, announced that its third quarter profit was NT$18.68bn, a 68 per cent increase from the same quarter in 2010.

As impressive as HTC's profit margin was, a 93 per cent increase in smartphone shipments to 13.2m units shows how the company has managed to design and produce smartphones that people want.

HTC is forecasting a good fourth quarter, with smartphone shipments in the 12m to 13m range and revenue up by 20 to 30 per cent. All in all, things are looking pretty rosy for HTC, even though it is facing a patent battle with Apple and its Flyer tablet has failed to take off.

It's not surprising to see HTC post bumper financials. The firm's Sensation smartphone has been arguably one of the best smartphones of 2011, vying with Samsung's Galaxy S II and Apple's Iphone 4 and Iphone 4S. The firm's more affordable Wildfire S handset has also performed well in the mid-range market.

However HTC's Achilles' heel is the tablet market. Its Flyer tablet was generally regarded as an expensive device that simply could not match devices from rivals such as Apple and Samsung. If HTC really wants to continue its impressive growth, then it will need to produce a tablet that is competitive and does not lead to Apple seeking injunctions against it. µ