HTC, Motorola, and Sony make cuts to workforce amid weak mobile sales

[FFR]

Things aren't going so well for some android vendors.



HTC cuts 15 percent of workforce amid weak sales

"As expected, smartphone maker HTC has announced more layoffs, and the cuts are brutal. The company will let 15 percent of its workforce go (over 2,000 employees), due in large part to falling revenues and profits. Last week the company reported shaky financial results, which it chalked up to worse-than-expect sales of its HTC One M9 flagship. It's also facing an ever-tightening smartphone market and more competition, especially from Chinese companies like Xiaomi and Huawei. The layoffs are part of a company-wide realignment, and CEO Cher Wang, who took the reigns from Peter Chou in March, tried to put that spin on it."

http://www.engadget.com/2015/08/13/...d_Classic&utm_campaign=Engadget&ncid=rss_semi

Lenovo faces Motorola hangover, cuts 3,200 jobs as sales slide, profit tumbles

"China's Lenovo Group Ltd (0992.HK) will lay off 10 percent of white-collar staff after sales of Motorola handsets fell by a third, raising doubts over the personal computer giant's bet that a money-losing brand it bought for nearly $3 billion will help it become a global smartphone leader.
Shares in the world's biggest maker of PCs slid nearly 9 percent on Thursday after it said its quarterly net profit was halved as its mobile division lost nearly $300 million. Lenovo, which uses the U.S. dollar in operations rather than the recently devalued Chinese yuan, said it plans to cut about 3,200 non-manufacturing jobs with a one-time cost of $600 million."

http://mobile.reuters.com/article/idUSKCN0QI00720150813?irpc=932
http://mobile.reuters.com/article/idUSKCN0QI00720150813?irpc=932

Sony to cut 1,000 jobs in smartphone business: sources

"Sony Corp plans to cut around 1,000 additional jobs in its struggling smartphone division as it tries to bring its electronics business back into the black, sources said on Wednesday.
Sony, which has cut its earnings forecasts six times on Hirai's watch, has forecast a 230 billion yen ($1.95 billion) net loss for the business year to March, suspending dividend payments for the first time amid weakness in smartphones.The cuts would be in addition to the 1,000 jobs Sony already said it would eliminate in its mobile unit, the sources said.

That would mean Sony's mobile division workforce will shrink by about 30 percent to 5,000 by the end of the fiscal year ending March 2016."

http://mobile.reuters.com/article/idUSKBN0L02IA20150128?irpc=

 

[epicrayban]

Ouch, ouch, and ouch.

I'm most worried about HTC. Don't know how they're going to stay afloat. The 2016 HTC One will have so much to do and such a high standard to reach for to help them recover.

Sony is medium-level worry. I think they'll be around a bit. Sony does many other things successfully, so they can withstand a bit longer.

And Motorola... low-level worry. I think they'll be around for a bit. The new Moto devices should continue doing well, especially the G, and I'm excited to see the next-gen Moto 360. I think that has a chance to do well, too. If Lenova/Motorola is managed carefully and well, I can see them coming back.

 

[MRU]

It's a very tough - ultra-competitive market out there in the Android hemisphere.

 

[spriter]

Inevitable given HTCs recent performance....

http://m.gsmarena.com/htc_is_sellin..._counter_bad_financial_results-news-13614.php

Obviously not confident of a turnaround that merits the capacity going forward.

 

[FFR]

Looks like Samsung is cutting 10% of their work force as well:

Samsung Cutting 10,000 Staff at HQ
http://mobilemarketingmagazine.com/samsung-cuts-10000-jobs-hq/

 

[John Mcgregor]

It's a very tough - ultra-competitive market out there in the Android hemisphere.

Everyone's buying iphone, because it's an overall better phone and better experience. This is to be expected.

 

[mrex]

Everyone's buying iphone, because it's an overall better phone and better experience. This is to be expected.

Eh, no... Everyone already has a phone they like and the phone is capable to do things they need to do. Every high end phones sold during the last year or two are still pretty capable and high end android phones had power and high pixel density in the screen already and in this economic situation people dont throw money for a new phone. And in android section there are rising companies selling high end phones much cheaper than old companies are selling.

 

[Savor]

Too many cooks in the kitchen. Crowded field as is and you can't underestimate the Chinese vendors like Xiaomi, Meizu, ZTE, Oppo, and Gionee. Then HTC is getting surpassed by ASUS as the de facto Taiwanese company because of price. The smartphone market is already saturated as is with too many phones and competition.

 

[I7guy]

Eh, no... Everyone already has a phone they like and the phone is capable to do things they need to do. Every high end phones sold during the last year or two are still pretty capable and high end android phones had power and high pixel density in the screen already and in this economic situation people dont throw money for a new phone. And in android section there are rising companies selling high end phones much cheaper than old companies are selling.

Given the right economy Apple sold 13 million phones during the launch, so I'd say people are buying.

 

[MasterRyu2011]

The problem is exposure.

Do HTC, Sony, and Motorola even advertise anymore? At least in the US, I haven't seen a single commercial of the HTC One M9 or the Moto X Pure Edition. Forget about Sony. They're non-existent. Maybe I just don't watch enough TV.

These companies make top-notch phones, but don't make the effort to showcase it enough to the GP. The average consumer is really not going to care about camera low-light performance (they use flash). They don't care whether a phone has expandable memory or removable back. They don't care about stock Android. Samsung spends a crazy amount of money in marketing. You go to airports and you see photos of its Galaxy Line. They're on TV. They're in movies like Jurassic World and the Avengers.

 

[kdarling]

Looks like Samsung is cutting 10% of their work force as well:

Samsung Cutting 10,000 Staff at HQ
http://mobilemarketingmagazine.com/samsung-cuts-10000-jobs-hq/

"According to Bloomberg, the company is largely targeting workers in areas including finance, human resources and public relations, and is looking to cut expenses in other ways as the pressure mounts to turn around what has been a poor year for the firm."

Sounds like they needed the cut anyway. 100,000 people at a HQ is a pretty big number.

How many does Apple have at their Cupertino complex? 24,000 in all buildings?

 

[Tsepz]

Everyone's buying iphone, because it's an overall better phone and better experience. This is to be expected.

If everyone is buying iPhone, then iPhone should be thrashing Android/Samsung Market Share in every part of the globe.

Please do not even bother to use the price excuse, the iPhone 4S is being sold at low end Android prices.

 

[FFR]

"According to Bloomberg, the company is largely targeting workers in areas including finance, human resources and public relations, and is looking to cut expenses in other ways as the pressure mounts to turn around what has been a poor year for the firm."

Sounds like they needed the cut anyway. 100,000 people at a HQ is a pretty big number.

I disagree, 10% of your hq workforce is substantial. Especially if it's just the beginning ...

From your article:
"Samsung is targeting workers in the human resources, public relations and finance departments, Korea Economic Daily reported Tuesday, citing people it didn’t identify. Samsung also plans to cut some expenses next year, the report added. Samsung declined to comment in an e-mail."

The article doesn't report it as a "cut any way"

"The moves come after new high-end Galaxy smartphones failed to impress consumers, triggering five straight monthly declines and wiping out more than $40 billion in Samsung’s market value since April. The company’s share of global smartphone shipments fell more than 3 percentage points in the second quarter, and it’s no longer the top seller in China, the world’s biggest mobile-phone market."

How many does Apple have at their Cupertino complex? 24,000 in all buildings?

Going off topic, but Apple isn't cutting 10% of thier hq employees, quite the opposite they are growing.

 

[Savor]

A couple years ago, it looked promising for all three OEM's. HTC came out with the multiple-award winning One M7 and were coming back financially last year. Sony Xperia Z was quite popular in 2013 especially in Japan selling 15M. And Moto X and Moto G were well-reviewed or well-received.

The game has changed.

I think for many to standout, they would have to create a MULTI-SERIES OF FLAGSHIPS. Look at Samsung coming out with Edge series to follow their S and Note line. But HTC and Motorola don't have those type of funds to create a multi-series of flagships and Sony tried going with biannual flagships which were generally the same as the previous one from six months ago and it ticked potential buyers off so it backfired.

To stay in the game, they need multi-gimmicky, multi-series premium flagships. They need to differentiate each flagship line. The S is the standard flagship for Samsung during the first half of the year. But they also have the Note for people who want a bigger screen or Edge for the hipsters. And they have a bunch of other series below it like the Alpha series. It is why LG had to up their game with the V10. A lone G flagship once a year was not going to cut it.

The days of having only one flagship per year is out the window. Samsung figured it out already. There are 7B people out there and each passing year the interest for smartphones will go down since everything will start looking the same. So why upgrade? So they created newer gimmicks to cater to all types of consumers.

 

[kdarling]

I disagree, 10% of your hq workforce is substantial. Especially if it's just the beginning ...

It's extra fluff. Clearly they went on a hiring and spending spree, and now it has to be scaled back.

Going off topic, but Apple isn't cutting 10% of thier hq employees, quite the opposite they are growing.

Back when Apple DID have too many people and were spending too much money, Jobs came back and cut like heck.

Every company has to learn.

 

[Savor]

Motorola is the only OEM I am rooting out of that three. They are the only one from that trio that actually offers very good phones for a very good price. HTC and Sony don't have a clue with budget phones. Sony offers the Xperia M5 higher than an Asus Zenfone 2, Xiaomi Mi 4i, and Meizu m1 Note. No wonder HTC and Sony are getting killed in the low end by several Chinese makers. Two years ago, I listed HTC and Sony as two of my favorite OEM's while I was always lukewarm with Motorola for several years. I was never into Moto. Now I don't care for HTC and Sony's fate and rooting for Motorola much more this time. Motorola and Nokia are the old timers of the industry and I am rooting for them both while HTC and Sony is about premium design and price gouging. A budget HTC Desire 510 with removable battery still sucks in battery life. HTC and Sony just never learn. Price and battery life are two of the top 3-5 most important areas in a smartphone.

 

[maflynn]

HTC and Sony are on the ropes.

Unless HTC makes some hard decisions on what its going to do, i.e., high end, midrange and start making phones people actually want, they'll not be around.

As for Sony - I don't get why they're not selling phones. I think some of their latest designs have been decent.

 

[Tsepz]

Seems nobody is safe:
http://www.phonearena.com/news/Appl...s-in-response-to-weak-iPhone-6s-sales_id74756

Lets wait and see how this goes...

 

[FFR]

Seems nobody is safe:
http://www.phonearena.com/news/Appl...s-in-response-to-weak-iPhone-6s-sales_id74756

Lets wait and see how this goes...

Perhaps they are just decreasing inefficient Samsung a9 orders?

But seriously, Apple hasn't finished launching the iPhone 6s/iPhone 6s plus in all international markets (I believe only 30 markets currently vs 130 by years end). It would be more efficient for Apple to ramp up international launch schedule than to decrease orders barely 3 weeks after shipping the iPhone 6s/6s plus on September 25. I strongly doubt the veracity of that report. Not to mention, I was at the Apple Store last night exchanging my iPhone 6s Plus, and everyone was buying an iPhone, the place was a madhouse around 9pm yesterday evening.

Let see what Apple releases in their quarterly earnings exit week.

 

[FFR]

HTC and Sony are on the ropes.

Unless HTC makes some hard decisions on what its going to do, i.e., high end, midrange and start making phones people actually want, they'll not be around.

As for Sony - I don't get why they're not selling phones. I think some of their latest designs have been decent.

I believe htc and Sony are done, there shipping less phones than blackberry did before they imploded. Sony could barely break 7.2 million iPhones last quarter and I doubt htc is shipping more than 1.5 million phones a quarter. It's almost lights out for some of these oems (as in exiting the phone business like Nokia did).


http://www.xperiablog.net/2015/07/3...eria-sales-full-year-forecasts-lowered-again/

Even lg isn't immune:
"LG admitted that the market for premium smartphones suffered from lower demand. "

http://techcrunch.com/2015/07/29/lg-q2-2015/

Not only that but the article reveals that North America now accounts for about 60% of lg total mobile phone sales, which correlates with what is being reported regarding Apple sales spiking everywhere else.

Bear in mind, none of this has taken into account the iPhone 6s or 6s plus launch, which will have a material impact on these and all premium android oems going forward.

 

[FFR]

It's official we can add lg to the list:

"Retailers were having so much trouble moving stock that the G4 was offered with almost no profit margin. The LG G Flex 2 was in pretty much the same boat a while back.

At this rate LG is steadily heading toward a sales crisis and things might actually get worse, before they get any better, considering the iPhone 6s duo is opening sales in Korea and preorders are already piling up like crazy."

http://www.gsmarena.com/sales_repor...ing_very_well_on_its_home_turf-news-14662.php

 

[Technarchy]

I hate to see any of these companies suffer, but the market is shifting and the meat and potatoes may not be for $600 smart phones.

I think the HTC A9 may represent better how things look in 2016. Solid experience, affordable, and less fluff. This makes sense to me. The cramming everything in strategies employed by HTC, Samsung and LG may not make sense for future growth.

 

[kasakka]

The game has changed.

I think for many to standout, they would have to create a MULTI-SERIES OF FLAGSHIPS. Look at Samsung coming out with Edge series to follow their S and Note line. But HTC and Motorola don't have those type of funds to create a multi-series of flagships and Sony tried going with biannual flagships which were generally the same as the previous one from six months ago and it ticked potential buyers off so it backfired.

To stay in the game, they need multi-gimmicky, multi-series premium flagships. They need to differentiate each flagship line. The S is the standard flagship for Samsung during the first half of the year. But they also have the Note for people who want a bigger screen or Edge for the hipsters. And they have a bunch of other series below it like the Alpha series. It is why LG had to up their game with the V10. A lone G flagship once a year was not going to cut it.

The days of having only one flagship per year is out the window. Samsung figured it out already. There are 7B people out there and each passing year the interest for smartphones will go down since everything will start looking the same. So why upgrade? So they created newer gimmicks to cater to all types of consumers.

Gimmicks are exactly what they don't need. I can't think of any feature on Apple devices that was quickly abandoned but instead they came out with features that do improve the user experience. The verdict is not out for 3D touch yet but their previous new feature, the fingerprint reader has become something I want to see in every flagship phone.

Meanwhile we have stuff like Samsung's various efforts for rather useless hover gestures and the edge glass that only distorts portions of the display and was not really useful for anything meaningful. Many reviews on the other hand seem to like the gestures for launching the camera on the new Motorolas. Stuff that is actually useful.

If Samsung can succeed with foldable displays that could be a huge win for them. For Sony I'd like to see them corner the market for smaller phones instead of playing "me too". Their Z5 Compact was so close but could've had a slightly bigger, better display and something other than the infamous Snapdragon 810 (yes it still gets hot in every phone) at a bit less of a premium. I think Motorola's new Style/Pure Edition (WTF is with that name tho) was also really close but the omission of a fingerprint reader and reports of questionable battery life made me avoid it. LG G4 didn't seem to improve on G3 much which either shows the G3 was ahead of its time or that they just didn't bother to truly overhaul it.

Small Chinese companies are putting huge pressure on the big brands by providing cheap phones with flagship specs and surprisingly nice design. If the old brands can't respond then we will probably start looking up to Xiaomi and the like for competition to Apple.