What if HTC and Xiaomi merged?

HTC’s revenue has dropped 55% year-on-year accoding to its latest financial results. The company situation is worrisome, and its smartphone business has been unable to reverse that fact. Every single model released in the last few years hasn’t had the warm welcome other HTC devices had in the previous years.

But HTC is far from dead. The HTC Vive seems to prove that, and it’s clear that virtual reality –and wearables– is now a possible last resort now that their phones are fighting with irrelevance and, above all, with the ones from Apple, Xiaomi, Lenovo and Huawei.

Xiaomi is doing quite well, though: it’s soaring in wearables and the recent launch of Xiaomi Mi 5 marks an interesting milestone that will allow them to compete in the high end (with almost mainstream prices).

HTC’s smartphone business isn’t working, and Xiaomi smartphone business is limited by its international expansion, something that HTC could provide.

What would happen if these two companies merged? Current HTC market cap is $81.94B, while Xiaomi has a market valuation of $45B. One could benefit from the other: HTC would be able to take advantage of Xiaomi’s strengths and ditch its own smartphones (or combine them with the best from its partner), while Xiaomi would be able to expand globally faster.

Is this nonsense?

Author: Javier Pastor

Javier Pastor is a technology journalist that has been writing about tech since 1999. He started writing for PC Actual in Spain, the leading printed magazine in the country, and in 2006 started to write online. First as the Chief Editor for The Inquirer ES, and after that for MuyComputer until 2013. That year he became senior editor at Xataka, the leading tech news website in Spanish with over 5M uniques/month (Aug'15, comScore). Xataka is part of Weblogs SL, a blog network that gets over 40M uniques/month and that has a wide catalog of publications in Spanish. The Unshut is his new venture and allows him to express his opinions and thoughts on everything touched by technology, and follows what he has been doing at Incognitosis, his personal blog, since 2005.