HTC released their consolidated revenue numbers for August showing a sharp drop off for the smartphone manufacturer and their lowest monthly number in 13 years. Bad financial results for HTC are nothing new for the company and are a big reason why CEO Cher Wang has been courting investors who may be interested in buying out the company. One interesting name that came up in the past was Google and new reports have surfaced indicating that Google is in final negotiations to complete a deal with HTC.
Details are still thin regarding a possible deal for Google to buy HTC. One of the big questions is whether HTC will sell just the smartphone business or the whole company. In the past, Wang has shown great interest in spinning off the HTC Vive VR business into a separate entity. If a deal with Google is imminent, that move could work from a timing standpoint.
Meanwhile, HTC is producing the smaller Pixel 2 phone for Google slated to be released next month. That means HTC could start shipping units in September, which could explain the company’s claim that third quarter smartphone shipments will be in line with expectations despite the disastrous August experience.
In looking at the numbers, demand for the HTC U11 peaked in July with shipments falling off in August. Cumulative sales for HTC are down 14.4 percent for the year. That includes a sharp decline of 51.5% in consolidated revenues from July to August. Compared to the prior year, revenues are down 54.4%.
Do you think Google buying HTC makes sense?