HTC said it expects its handset shipments to slow to 12.0-13.0 million units in the fourth quarter, after shipping 13.2 million devices in the third quarter. The forecast means annual growth will drop to 31-42 percent, from a rate of 93 percent in the third quarter. The company posted third-quarter sales up 79 percent from a year earlier to TWD 135.8 billion, led by a nine-fold increase in sales in China. Both revenue and shipments were slightly below the company's previous guidance. The average selling price was USD 344 in the quarter, up 0.6 percent from a year ago and down 1.4 percent from the second quarter. HTC said the flat performance was due to a broader sales mix of both low- and high-end phones. For the fourth quarter, it expects annual revenue growth of 20-30 percent, to TWD 125-135 billion. The gross margin is estimated at around 28 percent, in line with Q3, and the operating margin at around 14.5 percent, after 14.9 percent in Q3. HTC's net profit in Q3 was up 68 percent from a year ago to TWD 18.68 billion. HTC said it plans to continue to expand in China, with a footprint of around 2,000 retail outlets carrying its products by year-end. Its new factory in Taoyuan should also be ready at the start of 2012, offering an annual capacity of 40 million units. In addition, it's started the third phase of its brand campaign, focusing on "creating brand preference and emotional connection" with customers. This is supported by new services, based on the recent acquisitions Beats (headphones) and Dashwire (cloud storage).
