Struggling HTC gets ready to ring in changes in 2013

HTC, the smartphone maker that surged into the global market share rankings two years ago, is seeking to repair itself this year after a slide due to marketing shortfalls, competition from Samsung and old legal battles with Apple.

The Taiwanese company, known for its mid-priced Android-based smartphones, posted operating income of just 1 per cent of sales in the fourth quarter, capping a tough year.

HTC's attention to a range of difficulties, from buying parts to selling finished phones, puts it in position to consolidate this year, especially as the company and archrival Apple dropped 20 patent lawsuits in November and signed a 10-year licence deal for future patents.

But it's deep enough into those difficulties to hold any comeback well below the growth momentum of 2010, when revenues grew 93 per cent to NT$278.8 billion (HK$74.4 billion), industry analysts warn.

They say HTC, which reported revenue of NT$60 billion in the fourth quarter, should expect a levelling off this year if it can compete with the Galaxy smartphone series made by its chief Android operating system rival Samsung, as well as cheaper brands in the massive mainland market.

"We look neutrally at its growth this year," said Peter Liao, an analyst with Nomura Securities. "The end of the Apple lawsuits definitely has a positive impact on the US market, but there's no change in emerging markets such as China."