VTech Holdings Limited (an abbreviation of Video Technology Limited or simply VTech) is a Hong Kong electronics company founded in October 1976 by Allan Wong (Chi-Yun) and Stephen Leung. It is known for manufacturing cordless phones, baby monitors, and electronic learning toys, as well as providing contract manufacturing services.
Name and listing The company was originally named "Video Technology Limited" in reference to the company's first product, a home video game console. In 1991, it was renamed "VTech Holdings Limited" to reflect a wider portfolio of products. The company was first listed in Hong Kong in June 1986 under the name "Video Technology International (Holdings) Limited". It was privatised and delisted from The Stock Exchange of Hong Kong Limited in 1990. VTech obtained a primary listing on the London Stock Exchange in 1991. In 1992, the company relisted on The Stock Exchange of Hong Kong Limited, establishing a dual primary listing with London. In 1993, the company established its American depositary receipt programme. VTech was delisted voluntarily from the London Stock Exchange on 7 October 2008. It also terminated its American Depositary Receipt programme with effect from 21 January 2011.
History
VTech was founded in Hong Kong in October 1976 by two local entrepreneurs, Allan Wong (Chi-Yun) and Stephen Leung. When the first single-chip microprocessor, the Intel 4004, became available in the early 1970s, the company saw the potential it offered for portable consumer electronics products. Wong & Leung set up a small factory in To Kwa Wan, with a US$40,000 investment and a staff of 40 people. In the first year, turnover was less than $1 million. VTech initially focused on developing video games. In 1977, the company created its first home TV game console, a version of Pong. Since only consumers in North America and Europe could afford such items, the company targeted primarily these markets. The United Kingdom was chosen as the first market for Pong, as Hong Kong and the UK used the same standard for television systems. In 1978, the founders introduced LED games they had developed to buyers from RadioShack in the US, which were sold under the RadioShack brand. VTech then began to build its own brand. Starting in the early 1980s, a line of electronic games would be manufactured. VTech unveiled its first electronic learning product, called Lesson One, at the New York Toy Fair, in February 1980. It taught children basic spelling and maths. An exclusive version under the name Computron was offered to Sears, with the product being prominently advertised by Sears, in its catalogue, which was a popular shopping guide. Next, VTech made the video game console CreatiVision. An electronic product with an external projector from French company Ludotronic was adapted by VTech and sold as the VTech ProScreen in 1984, following the release of VTech's Gamate and Variety handheld products the year prior. VTech then branched out into personal computers, including a series of 8-bit TRS-80 competition computers named the Laser 200, 210, and 310, as well as a series of IBM PC compatibles both beginning in 1983, followed by Apple II compatible computers, beginning in 1985, including a model called Laser 128. After acquiring PC manufacturer Leading Technology of Oregon in 1992, VTech exited the personal computer market in 1997 due to tight competition. In 1985, the United States Federal Communications Commission (FCC) allocated the frequency band 900 MHz to ISM (industrial, scientific, and medical) devices. Taking advantage of this, VTech began development on a cordless telephone, using the 900 MHz band, and in 1991 introduced the world's first fully digital 900 MHz cordless telephone. In 2000, to expand its cordless phone business, VTech acquired the consumer telephone business of Lucent Technologies. The acquisition also gave VTech the exclusive right for 10 years to use the AT&T brand in conjunction with the manufacture and sale of wireline telephones and accessories in the United States and Canada. Although the acquisition increased sales of VTech's telecommunication products by 50%, it led to operating losses and write-offs. The company issued a profit warning in March 2001 and launched a broad restructuring plan. By the financial year 2002, the company had turned around the business and returned to profitability. Today, VTech's core businesses remain cordless telephones and electronic learning products. Its contract manufacturing services – which manufactures various electronic products on behalf of medium-sized companies, have also become a major source of revenue. The company has diversified geographically, selling to North America, Europe, Asia, Latin America, the Middle East, and Africa.
Core businesses
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