Having said it anticipates its sales momentum to continue into Q3, HTC started the quarter with uninspiring numbers for July.

The company reported sales for the month of TWD6.32 billion ($200.8 million), essentially flat from the prior month and down 15 per cent year-on-year. Its cumulative sales of TWD40 billion so far this year are less than half of the TWD81.9 billion in the same period last year.

HTC recently made much of its Q2 sales, which increased sequentially, noting strength both in its HTC 10 smartphone sales and VR product line. But year-on-year sales were down, and the company again used red ink for the bottom line.

In the company’s Q2 conference call, it said that both top line and bottom line should improve quarter-on-quarter, noting that it prefers this to a year-on-year comparison because “we’re in the transition phase, in terms of improving our entire organisation, our cost structure and streamlining our business in there”.

With its Vive VR line reaching the market in April 2016, the company has been reticent to state how much of an uplift this business is providing. In the conference call, HTC’s smartphone and connected devices chief Chialin Chang said that the intention is to provide further details when both Vive and smartphones start to stabilise.

And for all the talk of VR, it was also noted that smartphones are an important tool for HTC to generate the return to sales growth it needs to drive profitability.

Peter Shen, CFO, said: “We obviously need to get scale back, and right-size our cost structure along with that.”