HTC just tamed its growth expectations by filing a document with stock market authorities in which it says that Q4 revenues will fall short of expectations by 15%-23% (depending on each analyst expectations). The new guidance equates more or less to last year’s revenues, which is very surprising for a growth story like HTC. But is this cut a one-quarter story, or does it reveal something much deeper about HTC, and possibly Android?There are a few scenarios that come to mind. For one, it is possible that entry-level Android phones are “good enough” and that they undermine HTC sales in the mid-range. At the moment, the high-end appears to be doing relatively well, especially with subsidies.
Nokia did a big push recently, and they may have had traction with wireless carriers during the holidays. There is always a story of incentivized sales in the stores and sadly enough most people still simply listen to the sales guy at the store – that’s where a big chunk of the volume is.
Finally, the greatest menaced for HTC in the Android space is: Samsung. With the Galaxy S2 design, Samsung has gained a lot of market share, and there’s no sign that this will slow down. HTC handsets tend to be a little bigger, and they don’t have the same super AMOLED displays.
It’s hard to tell which it is, but if I had to guess, I would say that it’s a combination of all, with Samsung being the main issue for HTC in the next year. Some media were already starting to predict a “stall” (if not demise) for Android, but I don’t believe that. What’s your take?
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