Struggling smartphone vendor HTC (2498) said on Friday that its business will continue to decline in the third quarter this year. The company last month reported a massive drop in profit and revenue during the second quarter, and alongside its now-audited Q2 results, HTC has forecast further decline in the third quarter. Revenue this quarter is seen falling 23% compared to the same period in 2011, and both gross margin and operating margin are seen thinning to 25% and 7%, respectively. In the second quarter, the vendor managed a gross margin of 27% and an operating margin of 9%. HTC saw huge success with its Android smartphones in 2011, reporting six consecutive months of record revenue. The company’s hot streak came to a screeching halt in October, however, as Apple’s (AAPL) new iPhone 4S burst onto the scene and competition from Samsung (005930) heated up.