HTC new phone sales delayed in U.S.

May 16 (Reuters) - U.S. availability of two new smartphones from Taiwan's HTC Corp will be delayed due to a customs review required after the company lost a patent lawsuit against Apple Inc last year, exacerbating its already declining sales in its once largest market.

HTC said in a statement on Wednesday that "the U.S. availability of the HTC One X and HTC EVO 4G LTE has been delayed due to a standard U.S. Customs review of shipments that is required after an ITC (International Trade Commission) exclusion order".

Apple scored a narrow victory against HTC in a patent lawsuit in December over technology in the smartphones, one of many patent disputes in the fiercely competitive market.

Under that ruling, HTC phones with the technology covered by the lawsuit would be banned from the U.S. from April 19. HTC has said that it had a workaround to avoid the disputed technology, however all new phones are still required to undergo customs review.

Some shipments of the phones had reached the U.S. before the ban date, enabling their launch, but further shipments are being delayed, an HTC official in Taipei said.

In a separate statement, the company said it believes it is "in compliance with the ruling and HTC is working closely with customs to secure approval".

HTC shares fell 4.3 percent on Wednesday, in a broader market down 1,2 percent.

U.S. operator Sprint originally scheduled to launch HTC EVO 4G LTE on Friday and it has been taking pre-orders on its website, while AT&T, which has been carrying the One X model in store since May 6, says the smartphone is "out of stock" on its website.

Sprint and AT&T both declined to comment.

"Previously, it was expected that general exclusion order from the patent infringement referred to only old models from HTC. However, the latest news suggest otherwise with all models (new and old) potentially at risk," Goldman Sachs said in a trading note to clients seen by Reuters.

It said the U.S. market was expected to account for 15-20 percent of HTC's second-quarter shipments, and this delay might post potential downside risk to company's earnings this quarter and possibly in the third quarter, depending on how quickly HTC could resolve the issue.

Last month, HTC Chief Executive Officer Peter Chou said HTC wouldn't return to the days when more than 50 percent of its revenue came from the United States, a market where it saw a big drop last year because of the fierce competition from Apple's iPhone 4S.

Share this :

3 comments: