Sony Ericsson in Q4 2010: Less revenue, less devices sold, but more profit [Thanks to Android]

Sony Ericsson has just published their Q4 2010 financial results [PDF file] and while they sold fewer devices than they did this time last year, and also had weaker sales figures, they made more more. The Japanese-Swedish joint venture sold 11.2 million devices, down a whopping 23% from last year. The average selling price for said devices was 136 Euros, up 13% year on year. Total sales for the quarter hit 1.53 billion Euros, down 13% year on year, but here’s where things get better though: gross margins for the year 2010 hit 29%, nearly double the 15% of 2009, all of this thanks to a multitude of factors such as an increased focus on higher end devices, getting of rid of nearly 4,000 employees, and cutting operating expenses during 2010 by over 880 billion Euros. Total profit in Q4? 8 million Euros versus a loss of 167 million Euros a year ago. Also in the news is that over 9 million Android based Xperia devices have sold since that sub-brand was launched.

Is this a sign of things to come? Are more and more vendors going to cater towards the high end of the market in order to increase margins while we see new players crop up, such as Huawei and ZTE, who can better serve the middle and low end categories of devices? Every quarter we always say that the future is going to be interesting to watch, but this time we really mean it since Android has seemingly come out of nowhere and ended up on both flagship devices and bargain bin Chinese hardware that sells for what a decent feature phone did a year or two ago.

Nokia is due to report their Q4 figures at the end of next week, and then there’s Motorola and Samsung. Once those figures are out we can better see how the market is changing, and if the future of feature phones really is doomed or if it’s just in our imaginations.

Back to top ▴