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Stocks

Taiwan HTC down 8% as August sales plunge

New smartphone fails to shine as group sales take a 54% dive

Vive, HTC's virtual reality system, so far has been a drain on the company's finances.   © Reuters

HONGKONG -- HTC, a Taiwanese smartphone maker, extended a losing streak on Thursday, plummeting to 63 Taiwan dollars (US$2.09) at one point, down T$5.5, or 8.02%, from Wednesday. It was the stock's lowest level in about 2 and a half weeks. It finished at T$64, down 6.56%. The tumble is attributable to a 54% year-on-year fall in August group sales to T$3 billion. The disappointing results, announced on Wednesday after the marked had closed, triggered heavy selling.

HTC's August sales were about half of July's T$6.1 billion. Shipments of the company's high-end HTC U11 smartphone, released in June, peaked in July, resulting in the August nosedive. January-August group sales fell 14% from a year earlier to T$39.8 billion.

Some market participants expect sales to recover as Google's Pixel 2 smartphone, which HTC builds, is on track for release. HTC is also a player in the fledgling virtual reality sector. But the the company is still bearing the huge up-front costs of getting into the game. Its VR system has been unable to contribute to sales, sources close to the company said.

Furthermore, competition is intensifying in the VR market. In fact, Taiwan computer maker Acer is due to supply devices to a theme park in Dubai.

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