Sony Ericsson has reported today that their third-quarter profit is below market expectations as the company shipped far fewer mobile phones than expected, albeit its high-end mobile handsets were selling well.
Chief Executive Bert Nordberg said Sony Ericsson’s overall performance was “stabilizing”. “Our strategy to focus on the smartphone segment is succeeding and smartphones now comprise more than 50 percent of our total sales,” he said in a statement.
Less Profit Then Expected: Pretax profit for the firm, owned by Ericsson and Sony Corp. was 62 million euros ($87.28 million). Sony Ericsson posted third-quarter sales of 1.6 billion euros against a forecast for sales of 1.8 billion and shipped 10.4 million units, missing all 27 analysts expectations which ranged from 10.5 million to 13.9 million units. The average forecast was for Sony Ericsson to ship 12 million mobile phones during the July-September period compared to 11 million in the second quarter.
Just a Slight Growth in Market: The world’s fifth-biggest handset maker, Sony Ericsson has cut costs and revamped its portfolio, pulling itself back into the black this year after seven straight loss-making quarters partly thanks latest mobile phone offerings such as the n Xperia X10,Sony Ericsson Vivaz, Sony Ericsson Xperia X10 mini and Sony Ericsson Xperia X10 mini pro. The firm has pinned its hopes for further profit growth on a surging market for mobile phones offering PC-like functions and links to social networking sites. However, with all the top mobile brands jostling for market share, mobile phone competition will be tough from such suppliers as Apple, Samsung Electronics, Taiwan’s HTC and industry leader Nokia. Sony Ericsson repeated it only saw slight growth in the global handset market this year.