Coolpad forecasts HK$3 billion loss as ‘fierce competition’ hits smartphone sales

Chinese smartphone maker Coolpad said it expects to see a loss of HK$3 billion for the full year, a sharp decline from the HK$2.325 billion profit it achieved in 2015.

Coolpad, controlled by technology giant LeEco, said its sales fell by 43 per cent in the 10 months ended October 31, 2016, compared with the corresponding period a year ago, resulting in a loss of about HK$730 million from the principal business.

“The decrease was mainly due to the downturn and fierce competition in the domestic smartphone market,” the company said in a profit warning issued on Friday night.

The group only introduced one new smartphone product to the market in the second half of 2016 and has been focusing on inventory clearance.

It also expect to see a loss of about HK$226 million in the first 10 months of 2016 from its Coolpad E-Commerce business.

Coolpad said it has been adjusting its strategies, restructuring the business and developing an open retail channel. However, it still needs time to achieve a marked improvement in sales performance.