HTC Announces Quarterly Loss

On October 4th, HTC announced a quarterly financial statement that was different from the rest of all of the quarterlies in the company’s history. For the first time since starting up, HTC announced a quarterly loss. Losing $119 million, the stocks for HTC dropped twelve cents per share, falling to $3.58.

Similarities can be seen between this loss and that of HTC’s competitor Blackberry, but speculators are placing the blame in different places. HTC has no blame to put on the product itself, as HTC is a major competitor of the Android operating system for smartphones, even being picked up by Google for the Google phones, because of this, a watchful eye is being placed on management and marketing.

As stocks for HTC fall in the United States and Europe, HTC is starting to look to other international markets. Management and marketing will have to excel if HTC is to regain its feet in the markets where competitors like Apple and Samsung already hold a commanding lead, and if HTC is to establish a consumer base in the emerging markets.

Twitter Going Public

In September, Twitter announced that it would be going public in 2014. Twitter has become a social media giant over the past couple years and the announcement of an IPO has excited many users. The question though, is why is a company that has been doing so well privately deciding to switch to public now?

One answer to this question could be the financial surge a company gets after first going public. The surplus of money Twitter could receive after their IPO could go into funding for many different things that Twitter didn’t have the budget to fund before. These areas will probably be market research or product development. Both of these factors would also work into another possible answer.

Another reason could be to refuel the growth of the company. Back in 2012, Twitter was booming, gaining an incredible amount of new users daily, in 2013 however, while Twitter is still growing, it is moving at a snail’s pace compared to the numbers from 2012. Changing to a publicly traded company could be just what Twitter needs to rekindle its growth and continue to hold its position in the social media world.

Whatever reasoning, a high level of activity can be expected to be come out of Twitter after its IPO in the coming year.

US Government Shuts Down After Inability to Form a Financial Plan

At 12:01 a.m. Eastern Time in Washington D.C., on the First of October, 2013, the government of the United States of America temporarily shut down until a financial budget and plan can be put into place. The government shut down will likely hurt the U.S. economy as well as all of its trading partners, decrease the value of the U.S. dollar, and increase U.S. national debt.

This is important to look at from a business perspective for a couple reasons, the first being it is likely to negatively impact a tremendous amount of businesses, but also, it highlights the importance of a sound business plan.

Without a solid business plan, it is incredibly hard to understand expected costs and revenue, which makes creating a functioning budget virtually impossible. This can be very dangerous because it can lead to overspending or under-spending and missing out on potential business opportunities. In the case of the U.S. government, the lack of a financial plan was deemed so dangerous that salaries were halted for the majority of government employees until a budget can be determined.

Many of the risks for businesses can be seen with the  U.S. government case if properly put into perspective. The value of the dollar can be seen as the value of a stock, these would fall as people realize the risk in investing into an organization without a functional business plan. Countries that trade with the U.S. can be viewed as key partners, trade will likely reduce if a plan is not chosen soon since the U.S. will have a more limited amount of spending money. Finally, the increase in national debt would correlate to the drop in productivity of the company which would in turn decrease revenue and profit.

Stable business plans are the back bones of flourishing organizations, and unless a plan can be agreed upon soon in Washington, the United States may have a fairly bumpy road ahead of them.