Beleaguered firm announces huge loss due to cloud gaming system restructure.
HTC's sales have been in decline for a couple of quarters and now one of its investments is failing it too.
The Taiwanese company is set to make a $40 million loss from its investment in online gaming platform OnLive.
The cloud gaming system was hoped to bolster HTCs smartphone gaming offering, but after announcing last week that an unnamed buyer has acquired it, OnLive is the subject of intense financial speculation and has recently laid off hundreds of employees.
HTC announced the investment loss in a Taiwan Stock Exchange filing, stating that OnLive completed an asset restructuring during this past weekend because of a "lack of operating cash and an inability to raise new capital." The company declined to elaborate on its investment.
HTC made its $40 million investment in OnLive in February 2011.
In July, HTC said it will sell half of its stake in Beats Electronics, the audio equipment maker it bought to improve sound on its devices.