Sony Ericsson Posts EUR198 Million Loss for Q3

Japanese-Swedish phone maker Sony Ericsson has announced today its financial results for the third quarter of the ongoing year and has posted a loss of 198 million Euros for the time frame, as well as improved gross margin, although its sales during the quarter dropped 4 percent sequentially and 42 percent year on year, going down to 1,619 million Euros. However, the company seems to regain its foothold after a series of quarters during which its losses went from bad to worse. Thus, it has announced that during the quarter its mobile phone shipments were of 14.1 million units, marking a 2 percent increase over Q2, and a 45 percent drop compared to the same quarter a year ago.

The company's gross margin was of 16 percent, slightly higher than in the second quarter of this year, though still lower than a year ago. The Average Selling Price (ASP) the joint venture announced was of 114 Euros, lower than in Q2 (122 Euros), yet higher than during the third quarter of last year (109 Euros). The company has also announced that it has seen a sequential improvement in percentage rate and volume, mainly due to cost saving actions, as well as due to the successful sales of the W995 Walkman handset. Although the phone maker posted a loss for the quarter, it was lower than the 283 million Euro loss it announced for Q2 2009.

“Our business in the third quarter started to show the effects of our ongoing transformation programme. Having refreshed our brand we are now better positioned to support the launch of new products such as Aino and Satio in Q4 2009. We have cleared channel inventories, and have continued to realign internal resources and improve efficiency. We have also arranged external financing to strengthen the company’s financial position,” said Dick Komiyama, outgoing president, Sony Ericsson. “Transforming the business for future growth and returning Sony Ericsson to profitability is the focus of the senior management team and will continue under the new leadership.”

According to Sony Ericsson, its market share during the third quarter of the year has been of around 5 percent. When it comes to the remainder of the year, the company says that it expects for the global handset market for 2009 to shrink by around 10 percent, in line with its previous previsions.