HTC may sell off its VR business in order to stabilize losses from its smartphone division, sources say.
HTC's beleaguered smartphone division has caused the company to weigh specific options that may lead to an outright sale or spin-off of its Vive virtual reality business, anonymous sources have told Bloomberg. The Tawainese smartphone-maker reported its eight straight consecutive loss in May, with losses of $66 million in first quarter of the current fiscal year.
Anshel Sag, analyst at Moor Insights and Strategy, told us that spinning off the VR division may have been planned all along, and if so, it won't be hard for HTC to accomplish. "HTC's smartphone business continues to struggle. The company has lots of valuable IP in that business and decent products but has failed to compete with the Chinese manufacturers and Samsung. Their VR division is already a whole owned subsidiary so spinning off Vive shouldn't be hard at all and I believe was part of a long term plan."
"I believe this news is part of a natural progression of HTCs plans and their continued weakness in their core smartphone business," Mr. Sag continued.
HTC's premium PC-powered Vive VR was made in conjunction with PC gaming giant Valve, and has sold less than 670,000 units through Q2 2017 according to IDC findings. Following a recent price cut to Facebook's Oculus Rift VR platform, HTC cut the Vive VR's price tag by $200 to $599 in an attempt to spur sales.
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