HTC Profits Jump 33 Percent on Android Success

HTC's efforts in the high-end smartphone market are paying off, as the company today reported a 33 percent jump in profits for the second quarter of 2010.

Building on its success with Google's Android operating system, with smartphones like the Evo 4G and Droid Incredible, HTC today reported net profit for the quarter of $269 million. Unconsolidated revenue topped $1.9 billion, up 58 percent year-over-year.

The company shipped 5.4 million units in the second quarter, but in its third-quarter guidance said it expects that number to rise by 20 percent. In 2009, HTC shipped just 2.8 million units in the third quarter.

In other third-quarter guidance, the company said it expects revenue to more than double to around $2.2 billion from $1.1 billion a year earlier.

In March of 2010, Apple filed a lawsuit against HTC, alleging that it infringed on patents. HTC returned fire, leveling a patent infringement suit against Apple. In a statement, the company said that it believes the lawsuits will have limited impact on its financial results or sales activities.

The company recently announced that it would be switching display technologies on some of its devices, from AMOLED screens to Super Liquid Crystal Displays (SLCD). Lack of AMOLED supply was cited as the reason for shortages of the HTC Droid Incredible.

The company claims that of every two Android-based smartphones being sold, one is made by HTC.

Meanwhile, the company took the positive earnings as occasion to announce a series of executive promotions and newly created management positions which it said are "focused on building a stronger foundation for future growth."

HTC filled two newly created positions with talent from Sony Ericsson. Ron Louks was appointed chief strategy officer and Kouji Kodera was appointed chief product officer.

Among the promotions was David Chen, who has been elevated to chief engineering officer. Previously vice president of product development, Chen will continue to drive HTC's product development and engineering.

Jason Mackenzie was promoted to president of HTC North America and Latin America. Previously vice president of HTC North America, Mackenzie will continue to drive HTC's strategy and market growth in North America and Latin America.

HTC shares rose a sharp 7 percent on today's results, climbing from yesterday's close of $16.67 per share to $17.83. By Andrew BergThursday, July 29, 2010


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