Sony Ericsson Posts Higher Income Amid Lower Sales in Q3

Sony Ericsson, one of the worldwide leading mobile phone makers in the world, has just announced its financial results for the third quarter of the ongoing year, and posted a net income of Euro 49 million for the time frame, with a number of 10.4 shipped units.

While the number of sold handsets went down when compared to 14.1 a year ago or 11.0 in Q2 2010, the next income went up significantly, marking an increase of Euro 213 million year-on-year, and of Euro 37 million on a quarterly basis.

According to the company, its gross margin percentage reached 30 percent. Almost double when compared to the last year, the gross margin shows that the company is on the right track again.

“Our third consecutive quarter of profitable results illustrates that Sony Ericsson’s overall performance is stabilizing,” Bert Nordberg, President & CEO of Sony Ericsson commented.

“Our strategy to focus on the smartphone segment is succeeding and smartphones now comprise more than 50% of our total sales.”

“During the quarter, we launched our Android-based Xperia models in new markets, such as China and the U.S., and it is our ambition to become the global number one handset provider on the Android platform.”

The phone maker shipped 10.4 million units in the third quarter, 26 percent less than last year and 5 percent down from the shipment volumes in the second quarter of the year.

However, the average selling price (ASP) in the time frame remained at a high level, namely Euro 154, marking a 34 percent increase year-on-year, though going down 4 percent from the previous quarter.

“Sony Ericsson’s net cash position as of September 30, 2010 was Euro 538 million. The negative cash flow from operating activities was Euro 54 million, mainly due to payments during the quarter related to the transformation programme,” the company announced.

The handset vendor estimates it enjoys a market share of around 4 percent in unit base, though the value market share is expected to be of around 6 percent.

“Sony Ericsson maintains a forecast of slight growth in units in the global handset market in 2010,” the mobile phone maker concluded.