HTC Corp. will cut staff by 15 percent after a plunge in its share price rendered its brand, factories and buildings worthless.
Total reduction in costs will slice 35 percent off operating expenses as part of a restructuring that will create new business units, the Taoyuan, Taiwan-based company said in a statement today. HTC had 15,685 staff in March, according to its annual report, meaning it would shed about 2,300 jobs.
Once the biggest smartphone vendor in the U.S., HTC’s share price has plummeted 20 percent this week, taking its market value below cash on hand. Competition from Huawei Technologies Co. and Xiaomi Corp. has spurred a decline in sales, which led to HTC last week forecasting a loss this quarter five-times wider than estimates.
HTC now plans to focus on high-end smartphones, with fewer releases each year, and develop products in new areas including wearable devices and virtual reality.
“This strategic realignment of our business will ensure that each product group has the right focus, the right resources and the right expertise to win new markets,” Chief Executive Officer Cher Wang said in the statement.