HTC denies claims of a virtual reality (VR) spin off
Chinese tech giant HTC has denied claims that it will spin off its virtual reality (VR) unit into a separate business.
The company issued a statement on Tuesday which put the rumours to rest.
The statement by HTC was issued following recent reports by the Chinese media which claimed that HTC Chairwoman Cher Wang was planning to spin off HTC’s VR operations into an independent entity which would be fully owned by her and HTC.
HTC said in a message to investors:
“Recent media reports in Taiwan, such as by United Evening News, stating that Cher Wang is planning to spin off HTC’s VR operations into an independent entity that will be wholly owned by Wang is incorrect. HTC will continue to develop our VR business to further maximize value for shareholders.”
Although the claims were false, investors appeared to welcome the prospect of a VR split. HTC stock rose 5 percent after the initial reports were published.
Could a strong VR presence help turn the company around? Investors are counting on it.
The smartphone maker has had a series of unsuccessful mobile launches over the past year and its share of the global smartphone market has fallen from over 10 per cent in 2011 to just 1 per cent.
In the company’s most recent third quarter results it reported an operating loss of around $151m on revenue of $660 million – down from $1.3 billion in the previous year.
Investors are optimistic about the company’s recent focus on VR and wearables, anticipating that products in the segments could help generate boost profits in the first half of the year.
HTC has poured millions into the development of its Vive VR headset – created in collaboration with Valve.
The headset, which unveiled last year, will be available for consumers to pre-order on February 29. It will compete directly with the Oculus Rift VR – set to release in the first quarter of the year.