HTC is currently developing a waterproof camera for extreme sports that may challenge the popular GoPro camera brand in the market.

The device will be HTC's first camera as the company looks to diversify its business to produce more than just smartphones, as HTC has been experiencing a sales decline for the past three years.

HTC's camera will feature an ultra wide-angle lens and a 16MP sensor. The device will also be able to directly connect to other mobile devices that are being powered by Android or iOS.

The shape of the HTC action camera will be a tube, and will include support for both Wi-Fi and Bluetooth to connect the camera to smartphones. HTC may also develop its own applications for the Android and iOS for additional support for the device.

The details were revealed by a person familiar with the matter to Bloomberg, who wished to remain anonymous because the information has not yet been made public by HTC.

HTC has forecasted falling sales for the quarter, which would be the 12th straight for the company. As such, the company is looking for additional sources for revenue as its smartphones are not finding as much success in the market as rivals Xiaomi and Lenovo.

The revealed information that states that HTC is planning to launch a camera will put the company in competition with Taiwan-based GoPro, which has found massive success with its line of smaller, rugged cameras that are optimized for use in action sports.

The source also revealed that the camera, along with a smartphone that will specialize in taking selfies, could be introduced by HTC in a scheduled Oct. 8 press event in New York. HTC sent out invitations for the event this week, with a headline of "double exposure" and not much of any other details.

HTC is also reportedly developing a wearable technology device, but plans for the product have been pushed back and its release will likely be slated for next year.

GoPro, despite strong operating results driven by the increased market demand for the Hero 3+ Black Edition camera, reported losses for the previous quarter amounting to $19.8 million.

HTC's new camera, once released into the market, may prove to be a serious threat to GoPro as it looks to increase its revenue of $244.6 million in the previous quarter to offset its ballooning operating expenses.

HTC recently unveiled a Windows Phone version for its flagship One M8 smartphone that is priced at roughly half of the Android version of the same phone. According to the company, this is the first time that a flagship smartphone comes with options for more than one operating system.