Handset maker HTC is expecting sluggish revenue growth in the first quarter of this year, due to customers selling down their inventory, according to Reuters.

The Taiwanese company also expects its operating profit margin to fall from 18.4 per cent to 15 per cent during Q1, while taking an inventory write-down of T$600 million (around $17.7 million). It's forecasting Q1 revenues of T$33 billion (around $980 million).

Intriguingly, Reuters also claims that HTC is looking to phase out contract work - making handsets for other people - in favour of its own-branded phones.

HTC made the G1 Android handset for T-Mobile, and has been strongly tipped to be releasing a G2 later this year.

More than one million G1s were sold in Q4 last year, helping HTC to quarterly revenues of T$47.4 billion ($1.4 billion) - up 21.4 per cent year-on-year. It had predicted revenues of T$48 billion for Q4, though.