HTC profits drop 70%, company cites Apple's iPhone 4S as biggest cause

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Before Apple posted yet another blowout quarter, rival HTC revealed its profits dropped 70 percent thanks largely to the launch of Apple's iPhone 4S.

Apple's latest smartphone was specifically cited by HTC Chief Executive Peter Chou in an analyst briefing this week, according to Reuters. He revealed that HTC, which used to earn more than 50 percent of its revenue from the U.S., will not regain that stature in America.

"A major challenge we faced last year was the big drop in sales in the U.S. because of competition from the iPhone 4S," Chou said. His company saw its net profit in the first quarter of 2012 drop 70 percent year over year to $151.5 million.

HTC hopes to regain some of the ground it has lost to both Apple and Samsung with its new "One" smartphones. They feature improved cameras as well as advanced audio technology.

Chou told investors and analysts that he is hopeful HTC will be "reborn" this year. He said it's the dawn of a "new" HTC that will better execute sales and marketing of its products.

Though U.S. sales won't return to their previous levels, Chou is hopeful that the booming smartphone market in China will help to fill that void. Apple has had tremendous success in China, and revealed in its own conference call on Tuesday that iPhone sales in Greater China were five times greater in the first quarter of calendar 2012 than in the same period a year prior.

After HTC's earnings disappointed, Taiwanese industry publication DigiTimes reported on Wednesday that the company is working jointly with the social networking site Facebook to develop their own smartphone. The new Facebook phone will be launched in the third quarter of 2012 "at the earliest," sources reportedly told the publication.

The repot said that although HTC and Google previously worked together to build Nexus-branded smartphones, Google has since moved on and now works primarily with Samsung, the leading developer of Android-based phones.

HTC has apparently since moved on to partner with Facebook, and is developing a new smartphone that will "enable and integrate all functions available on the social networking site." The new smartphone will reportedly be a part of Facebook's development strategy when the company becomes publicly traded in the coming months.