Android is doing well but HTC’s profits aren’t

HTC didn’t have a happy Christmas in 2011.  The company’s sales fell by 25.5% in Q4 2011 compared to the same period in 2010. And this downward trend is expected to continue into 2012.

HTC’s performance was not typical of the other big players in the Android market. As we reported earlier Amazon’s Android-powered Kindle Fire was one of the bestselling items on Amazon during the month of December.  And according to data from The Guardian 42 million Android devices were activated in the same month bringing the global Android population to about 220/230 million devices.

We already have data from Google, Samsung, and Amazon which says that Christmas 2011 was very good for overall Android sales.  At the end of December 2011 Google’s head of mobile, and founder of Android, Andy Rubin, reported that there were some 3.7 million Android activations on Christmas Eve and Christmas Day, up from an average of 700,000 devices activated each day during the rest of the month.

So despite Android’s growth HTC took in $364.26 million in the last three months of 2011, which is down on the same period last year when the company took in $489.66 million.  HTC had seen significant growth earlier in the year and recorded $618.03 million during the third quarter.  This growth has helped the company post a year-end net rise of 57% on 2010.

Reuters reports that it expects the downward trend to continue for the first three months of 2012 during which time HTC isn’t expected to release any handsets.  Although HTC will reveal details of devices due for release later in the year.  Reuters also reports that “[HTC’s] rapid fall from grace saw its stock become the worst performer among global smartphone companies last year, down 42 percent, after Blackberry maker Research in Motion Ltd.”

Blame for HTC’s falling revenue has been cast on larger manufacturers such as Samsung which has seen huge success with its own Android-powered smartphones.