Sony Ericsson sees Q4 earnings slip into negative territory
By Will Park on Friday, January 16th, 2009 at 4:41 PM PST In Announcements, Financial/Corporate News, Sony Ericsson
With a slowing global economy, consumers are holding back their urge to splurge on new mobile phones. Sony Ericsson (NYSE: SNE) has been hit hard by decreased demand for cellphones around the world. The Japanese-Swedish cellphone maker has posted a negative Q4 2008 earnings report. The company’s €187 million ($245 million) loss in the fourth quarter highlights the impact of a global financial downturn. In comparison, Sony Ericsson posted a Q4 2007 profit of €373 million. Weaker handset sales and reduced margins were to blame for the manufacturer’s woes.
The company’s fourth quarter saw €2.9 billion (US$3.8 billion) in handset sales – a 23% decline from the year-ago quarter’s €3.8 billion. Sony Ericsson ended 2008 with a €73 million (US$96 million) loss, down from the €1.1 billion (US$1.45 billion) in profits that Sony Ericsson earned in the full 2007 year.
“In economic terms, 2008 has been a tumultuous year with world markets experiencing a serious downturn. The mobile phone market has been greatly affected by this and as expected, the fourth quarter continued to be very challenging for Sony Ericsson,” said Dick Komiyama, President, Sony Ericsson.
Komiyama confirmed that his company’s restructuring efforts were still on track to save Sony Ericsson €180 million (US$237 million) in annual operating costs. The savings will be realized towards the end of 2009, when restructuring efforts have been finalized.
For what it’s worth, Sony Ericsson has been putting out some desireable Cybershot cameraphones that might just help bring the company out of the red by the end of 2009.
[Via: CellularNews]
I bought a Sony Ericsson w580i last year, on sale from AT&T for $180 dollars. After a month, the ear speaker quality was severely decreased. After two months, the ringing speaker no longer worked. I sent the phone in to be repaired. It came back with the speaker issues corrected, but downloaded applications no longer worked. A month later, the screen blacked out whenever the phone slid open. A search on the internet shows this phone is no longer being sold, and that these problems are very common for that shaky model. So perhaps, if Sony Ericsson put a little quality into their phones rather than trying to push junk ahead of the competition in the hopes that by the time it broke you would be ready to buy the next model, they might see some profits.