HTC Q1 2016 earnings: Profits plummet nearly 80 percent

HTC 10

It’s clear HTC has a lot riding on the HTC 10, as well as its Vive virtual reality headset, but following the release of an abysmal Q1 2016 earnings report, it seems the financial situation at the company is more dire than some analysts expected.

According to HTC’s most recently quarterly financial report, the company’s revenue has dropped a staggering 64 percent compared to the same quarter last year. To make matters worse, HTC says profits have plummeted 78 percent compared to the same time last yet.

The company recorded a loss of $148 million USD on revenue of $455 million USD, marking this the company’s worst quarter in recent memory. In between January and March of last year, the company’s operating margin was down 32.4 percent, with revenue down 64 percent in the same quarter a year ago, and down 42 percent from the quarter before that.

Despite the impending trend of doom, HTC reportedly remains positive about its future given the relatively positive reception the company’s latest flagship smartphone, the HTC 10, has received, as well as strong early performance from the Vive, neither of which are represented in the company’s most recent quarterly results. It’s important to point out, however, that the Vive is likely years away from being profitable for the company.

According to HTC’s recently released financial, CFO Chialing Chang believes the company can start breaking even on its smartphone business as early as Q3 2016.

Related reading: HTC 10 review: Back to basics