HTC sees growth accelerating in Q3

Smartphone maker HTC forecast a 132 percent increase in its shipments in the third quarter, to 6.5 million units. Revenue is forecast up 106 percent to a record TWD 70 billion, and the gross profit margin is estimated at 29.5-30.0 percent. The outlook assumes an acceleration from the already strong growth of Q2, when shipments increased 80 percent to 5.6 million and revenues were up 58.5 percent year-on-year to TWD 60.5 billion. The company reported an average selling price of USD 340 for its phones in Q2, up slightly from USD 339 in Q1 but down from USD 358 a year earlier. The group was able to mitigate the euro exchange rate effect with optimised operating costs and a better product mix, it said. HTC said its scaling up production to allow for multi-million unit production for several models. Its Taiwan factory is at 2 million units per month and increasing and its Cina factory will increase capacity to 1 million units per month from Q3. While the company experienced component shortages in H1 like most in the industry, it said suppliers are ramping up to meet demand in H2. HTC also confirmed it will launch its first Windows Phone 7 by year-end. For the second quarter, HTC posted operating income of TWD 9.17 billion, up from TWD 6.89 billion a year earlier, and net income of TWD 8.64 billion, up from TWD 6.49 billion. Earnings per share were TWD 10.62.