“In the global smartphone war, brands are routinely measured by market share, revenue, profit, and the coolness of their ads,” Tim Culpan reports for Bloomberg. “But one line item called finished goods inventory, which refers to the percentage of materials that were manufactured into phones but went unsold, can give insight into whether a company’s fortunes are changing.”
“The latest company to let phones pile up in warehouses and on store shelves is HTC,” Culpan reports. “HTC’s finished goods inventory had climbed to a record high 2.35 percent of total assets at the end of last quarter. During the company’s heyday, that figure rarely nudged above 1 percent.”
“‘The rise in finished goods inventory could be a sign that HTC’s latest high-end phone, the M9, is not selling as well as expected,’ says John Butler, an analyst at Bloomberg Intelligence,” Culpan reports. “Once a smartphone is assembled and leaves the production line, the clock starts ticking. In the high-paced technology business, consumer devices lose their luster fast, which makes the chance of actually selling the product decline with each passing day as newer models come onto the market. Steve Jobs saw this when he returned to Apple in 1997 — at a time, he had said, when it was near bankruptcy — to find that finished goods inventory had climbed to 7.7 percent of assets. Jobs hired an operations guru from IBM [sic Compaq] named Tim Cook to clean up the mess. A year later, in June 1998, the number had dropped to 1.7 percent—and hasn’t crossed 0.9 percent in the past few years.”
Read more in the full article here.
MacDailyNews Take:
iPhones are not that cool anymore. – Martin Fichter, acting president, HTC America, September 12, 2011
SEE ALSO:
Beleaguered HTC posts $62 million Q1 loss on weak flagship phone sales – April 7, 2014
Beleaguered HTC prays for merger after first quarterly loss – October 4, 2013
AT&T discontinues HTC’s ‘Facebook phone’ flop after just one month – May 13, 2013
Beleaguered HTC profit plunges 91% – January 7, 2013
Analyst: HTC settlement worth up to $8 per phone for Apple; serve as model for future deals with Apple patent infringers – November 12, 2012
Apple and HTC settle global patent battle – November 11, 2012
To be correct, Jobs hired Cook from Compaq, though he did work at IBM earlier in his career.
MDN Take: 👍!!!
Wishful thinking!
Not at all surprised if my daughter’s work supplied M9 is anything to go by. Two weeks after activation it’s sloooow….to the point of useless. She took it back to the shop, got another one….which is equally slow right out of the box.
Eg. 5 secs to wake up. 10 secs to open a browser – any browser. 15secs to open the camera app + 5secs to focus + 3 secs to take a photo! PDFs freeze the phone. Word docs from emails hopelessly wrongly formatted. Touch screen equally bogged down when changing settings…
Utter craptastic landfill.
Loud cruel chuckles all around MDN’rs! The overly optimistic hubris and subsequent downturn comeuppance of CEO’s is never-ending.
Sounds to me just the sort of thing that happens when you ship a product sporting a half assed/p.o.s operating system based on software made by a NSA-led civil surveillance operation deceptively operating as a legitimate web search business.