HTC Moves Up in Rank, Taking Nokia's Spot in Market Value
posted Sunday Apr 10, 2011 by Nicholas DiMeo
Nokia has always been the worldwide leader of market share in the mobile world but only was third in market value. This week, however, HTC's rapidly growing popularity has caused the company to overthrow Nokia in the third rank as HTC posted record profits this quarter, making them the third largest phone maker behind Samsung and Apple.
HTC brought in a net income of $513 million in the first quarter, almost triple of last year and 20% higher than what analysts projection for the company.
Sales had a lot to do with this, too. HTC was one of the biggest benefactors of the Android operating system and sales were doubled because of it. HTC projects their sales to continue and their profits to soar this quarter as they are releasing their first tablet.
Will HTC's success continue after Android's announcement last week that they're moving to a more strict guideline for their platform? My speculation lies after the break.
One stock analyst does agree with HTC however. Jeff Pu at Fubon Financial says,
We expect HTC's new model launches in the second quarter to drive stronger shipment growth than peers in the next two quarters.
HTC also looks to send out over 8 million devices this quarter, which is over twice as many as last year and just under their record fourth quarter number of 9.1 million.
Interestingly enough, their ThunderBolt device for Verizon on their 4G network matched the iPhones sales in over half of the 150 stores measured and outsold the iPhone in 28 percent of them.
Several respondents indicated that the store lines were longer for the first day of the ThunderBolt launch than they were for the iPhone. Verizon sales people indicated that sales of the iPhone were still strong but they simply noted that the ThunderBolt was as strong if not stronger.
So HTC has seen a lot of success recently that has allowed themselves to think they will see a lot in the future. This may not be true, however. HTC pretty much only uses Android for their devices, and reports show that Android will make up almost half of all smartphones sold worldwide next year, but Android has now put a huge road block in the way of manufacturers utilizing their platform. Because of this, we may see several companies backing off, either by choice or by force, to accommodate the new requirements. This will probably lead to fewer handsets, at least with the latest version of Android on it, and a tighter, more competitive market. We'll also see, thankfully, better quality handsets because the money simply won't be there to make 20 of the same device on the same network from the same company.
I hope that HTC continues their success and overcomes the Android wall. I've heard that WinPho7 has some strict guidelines but is doing quite well. Maybe they should join the ways of Nokia and go exclusively WinPho. Thoughts?