HTC 2015 Annual Report Download - page 5

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Letter to HTC shareholders
Letter to HTC shareholders
6
7
LETTER TO
HTC SHAREHOLDERS
Dear Shareholders,
2015 was a deeply challenging year for HTC, as well as a year of radical transformation. Against a
backdrop of fierce competition in our core smartphone market and extended consumer product
replacement cycles, the past year has been dedicated to a comprehensive restructuring of HTC,
with enormous eort invested into tackling considerable legacy issues and stabilising and im-
proving processes across the business, in order to establish a firm foundation for the Company
going forward. The resulting financial performance over the year has been disappointing, but we
firmly believe that this huge undertaking was vital to enable the Company to meet current and
future business challenges. We appreciate the continued belief of our shareholders in HTC over
this period, and want to reassure them that the Company is now in much better shape to allow
our DNA of innovation to shine through.
This year saw HTC reinvent itself, driving new businesses and realigning resources to refocus
the Company for its next chapter of growth. Our business strategy has breathed fresh impetus
into our brand awareness, and we have regained our reputation in the industry as an innovation
leader. A brief overview of the year emphasizes the key achievements that position HTC well for
growth:
• Weimplementedabolddiversicationstrategy,enteringtheeldsofvirtualrealityand
connected lifestyle devices as innovation leader and teaming up with the strongest brand
partners in each sector;
• WereimaginedtheHTCbrand,restatingourbrandpromiseasthePursuitofBrilliance.This
inherently defines our company culture and character, as well as conveying our mission to
make products that enable our customers to pursue their own brilliance;
• Weundertookastrategicrealignmentofthebusinesstofacilitateourdiversicationstrategy,
resulting in the creation of specialised business units clearly focused on innovation in their
product category;
• Weimplementedacomprehensive,company-widestreamliningtoputusonarmcompeti-
tive basis to execute our product plans, and fostered a leaner, nimbler and more dynamic
organisation capable of responding more quickly to market trends;
• Ourstrategytodiversifyourproductportfoliointovirtualrealityandconnectlifestyledevices
has been well received by customers, partners, investors, and the media. Key stakeholders
have expressed confidence in our innovation, technology leadership and ability to execute;
• Weended2015onahighnote,withtheannualpeakofsmartphoneactivations,alongwith
the widely acclaimed, inaugural HTC Vive Unbound virtual reality developer conference in
Beijing.Moreover,wehadanexcellentstartto2016,withresoundingmediaandconsumer
acclaimatboththeConsumerElectronicsShow(CES)andMobileWorldCongress(MWC),
garnering over 50 awards across all of our product lines.
Tenyearsago,HTCsuccessfullytransitionedfromODMtosmartphonebrandcompany;now
with this diversification we have become a true personal technology innovator. With a clear
vision and focused resources, we are confident that the Company can thrive in this next growth
phase.
Product Strategy
As a pioneer in the smartphone market, HTC is credited with many industry firsts and technol-
ogy breakthroughs over the past 19 years – a history defined by innovation, design and engineer-
ing excellence, and the building of strategic partnerships to facilitate the development of an
industry ecosystem. This heritage in creating high-calibre consumer electronics experiences
has positioned the Company well to seize new opportunities and extend into new markets.
Smartphones
HTC remains firmly committed to its smartphone business. The smartphone is the most per-
sonal of all consumer devices, and has become our digital hub, our link to a world of smart
connected devices. Since smartphones and connected devices are so closely linked, they were
brought together into one business unit within HTC, so that the design and engineering re-
sources can benefit from cross-product synergies.