Partially state-owned electronics company TCL Electronics Holdings reported a significant surge in TV sales in the United States over the past three weeks, as more people clamor to purchase the appliance amid the widening lockdowns. The surge in sales has bolstered the Chinese firm's confidence for its growth prospects for the entire year.
The world's second-largest television maker by market share stated that despite the disruptions caused by the viral outbreak, it is still confident that it can hit its sales growth targets for the year. TCL chief executive officer, Wang Cheng, mentioned during a post-results conference on Monday that their much cheaper models are becoming very popular with US consumers as resources become increasingly scarce due to the wide-spread unemployment and decreased wages.
Cheng cautioned that the company is still expected to take a huge hit from the slowing business activity caused by the epidemic but it is hoping for a much stronger performance in the second half of the year. The executive explained that government stimulus money should support its continued growth, assuming that the epidemic is brought under control before the end of May.
TCL is banking on its mid to lower-end price range products to help it weather the storm in the coming months. The company is also expecting to increase its market share during this time as people stay away from much more expensive alternatives given the current economic situation.
Last year was a particularly good year for the electronics company as it managed to record a 119 percent jump in its net profits to HK$2.228 billion. The surge in its profits was mainly attributed to its strong expansion in overseas markets. Out of the 32 million units it sold last year, more than 42 percent were shipped to overseas markets. This represented a 37 percent jump when compared to the company's international sales a year earlier.
The Huizhou-based company also reported a massive surge in its rapidly growing internet business over the past couple of months, which now includes video games and online video streaming. According to the company, it saw a 139 percent increase in subscribers for January and February. Although its internet business is still currently only a small portion of its overall revenue stream but TCL is planning to expand the business to make it a much more significant source of income in the coming years.
TCL outlook and its performance thus far is a stark contrast to the gloomy outlook expected for the global TV market. According to data from market research firms, TV shipments globally could drop by 8 percent this year to only 212 million units. This is a drastic departure from the 4 percent growth in shipments recorded last year.
