Phone maker HTC posted second-quarter profit that beat estimates as rising demand for Android phones drove sales to a record.
Net income climbed 33 per cent to NT$8.6 billion (€212 million) from NT$6.5 billion a year earlier, the Taiwan-based company said today in a statement.
HTC is gaining from the growing popularity of Google's Android operating system for smart phones, which can download music, play video and surf the Internet. HTC will release more Android-based models this year, and the platform is expected overtake Apple's iPhone system among smartphones by 2013.
"We previously expected demand to peak in the second quarter of 2010, but now expect demand to be sustainable through second-half 2010," Bonnie Chang, a Taipei-based analyst at Yuanta Financial Holding Co wrote in a report today before the announcement.
Sales climbed 58 per cent to NT$60.5 billion, HTC said today, surpassing the NT$50 billion it forecast on April 28th. The average of 15 analyst estimates was for revenue of NT$50.6 billion.
HTC shares climbed 5 per cent to close at NT$495 today in Taipei, before the company announced earnings. The stock has gained 35 per cent this year, compared with a 7.8 per cent decline in the benchmark Taiex index.
Parent-level operating profit, which tracks sales less operating expenses, climbed 33 per cent to NT$9.2 billion. The average of 12 analyst estimates was for operating profit of NT$7.3 billion, according to Bloomberg data.
"HTC's 2Q earnings results show good execution of the company's brand and growth strategies," HTC said in a statement today. It didn't provide an explanation for the results or a sales breakdown.
Sales of Apple's iPhone 4, released last quarter, may challenge HTC's momentum in the second half, Joee Chang, who rates HTC "buy" at Jih Sun Financial Holdings in Taipei wrote in a June 30th report.
Apple in March sued HTC for patent infringement related to its user interface for Android phones and has asked the US International Trade Commission to block imports of the Taiwanese company's handsets. Apple and Nokia are also asking the ITC to block imports of each others' handsets. HTC has denied any wrongdoing.
An increasing number of developers making software for Android, and phone makers choosing to use the system on their devices, will help the operating system overtake RIM and Apple to become second to Symbian by 2013, according to a January 25th statement from research firm IDC.
Bloomberg