Taiwanese handset maker HTC still needs to prove its ability in terms of product development, execution and marketing, despite rival Apple forecasting a lower than expected result for the current quarter, a Swiss bank said Tuesday.
In its latest research note, Credit Suisse Group said that investors are concerned about whether Apple's weaker sales forecast will create an opportunity for HTC to bounce back.
"We find it difficult to believe that Apple will completely miss the product cycle of larger-sized screen smartphones so as to benefit HTC, unless there is a supply bottleneck," said Credit Suisse analyst Pauline Chen.
In the long term, Chen remained concerned about HTC regarding the Taoyuan-based company's increasing difficulties in product differentiation and more competition from other brands.
HTC's global logistics and marketing acumen remain to be seen after several quarters of disappointing performance, she wrote in the note.
On Jan. 23, Apple issued expectations that revenue for the quarter to March will range of US$41-$43 billion, which is below an earlier market estimate of US$45.5 billion and has sparked concern about weakening demand for iPhones.
In the quarter ending in December, the US technology giant posted US$54.5 billion in revenue, slightly lower than a previous market forecast of US$54.9 billion. Its net profit totaled US$13.1 billion, or US$13.81 per share, which beat the market's expectation of US$13.53.
In a Jan. 21 report, US bank Citigroup said Apple is not expected to launch a larger version of its iPhone this year, leaving open a short window of opportunity for HTC to stabilize its high-end market share.
Moreover, the bank said, Apple is unlikely to grow in the high-end smartphone segment this year due to the weakness of its iPhone 5, whose 4-inch display may fail to satisfy consumers' preference for screens larger than 4.7 inches.
Citigroup said that Samsung will snatch 70-80% of the market growth opportunity left by Apple's void, while the second-tier brands, including HTC, could still grow 25%-40% on an aggregate basis.