HTC Corp. denies speculating about cutting its workforce
Taiwanese smartphone vendor HTC Corp. ( ) denied on Friday a report saying that it will reduce its workforce to cut costs in the face of mounting losses amid fiercer-than-ever competition.
Though it denied it would lay off employees, HTC said in a statement that it is “focused on enhancing the brand and improving the business through a combination of companywide initiatives that include in- creasing operating accountability.”
The denial came after Reuters reported on Thursday that HTC will cut jobs and discontinue models as part of its efforts to focus on highend devices and take on Apple Inc. and Samsung Electronics Co.
As for the report about the move to discontinue models, an HTC spokeswoman told CNA that it is not unusual for a company like HTC to stop production of old models.
HTC said it will concentrate on cutting operating costs after incurring a loss per share of NT$9.27 in the first six months of this year, but it offered few specifics.
The cost reduction efforts “will include strategic cuts in certain areas of the business, increasing investment in growth areas of the business what will deliver return on investment and shareholder value,” the company said.
At an investor conference on Thursday, HTC forecast a loss per share between NT$5.51 and NT$5.85 for the third quarter, citing a product transition period as the cause.
The gloomy third quarter forecast led several foreign brokerages to cut their target prices to as low as NT$45 and recommend that investors cut their holdings in HTC shares.
Amid concerns over the smartphone brand’s outlook, heavy selling emerged in HTC shares soon after the local main board opened.
As of 12:13 p.m., shares of HTC had lost 10 percent, the maximum daily decline, to NT$63.00.
On Thursday, HTC Chairwoman Cher Wang ( ) resigned as the chairman of HTC’s affiliate chipmaker VIA Technologies Inc. (
), though she will remain on the company’s board.
HTC said Wang will devote all of her time to the company and to improving its operations.