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Sony Ericsson Issues Second Profits Warning

Gordon Kelly

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Sony Ericsson Issues Second Profits Warning

Sony Ericsson has been here before but now things are getting even worse...

Following on from some truly horrendous Q1 results where profits crashed 48 per cent to just €133m, the handset giant has announced a profits warning (it's second of the year) and admitted it may struggle just to break even during Q2.

Blaming "continued market challenges" which it explains as flattening demand for mid to high-end handsets (particularly in Europe) combined with shipment delays - both seen partly as results of the economic downturn. Consequently, SE claims it will ship approximately 24m handsets in Q2 with an average selling price of €115 each, Q1 saw it sell 22.3m for an average of €121 apiece.

Completing a miserable picture for the company is news it has also slipped to fifth place in the mobile marketplace. Nokia, Samsung, Motorola and now LG sit above it.

Of course things could be worse, Motorola has forgotten what profitability is and the R&D of Sony Ericsson is still producing cutting edge devices like the Xperia X1 (above). On the other hand, whether enough people will be able/willing to splash out on it however is another matter entirely...

Link:

via Financial Times

Williamn

July 1, 2008, 5:22 am

Incredible... where did it all go wrong for Sony Ericsson? They had such a solid brand.

Aspegic

July 1, 2008, 11:45 am

{quote}Ericsson is still producing cutting edge devices like the Xperia X1{/quote}





'Producing' maybe, but not selling. The X1 was announced in Barcelona earlier this year, but I hear it may even be 2009 before its actually available in the shops. Why does it take so long? Could it be sales are slipping because people are waiting for announced models to be shipped? Had the X1 been available now I would have bought one upping the Q2 sales figures (a tiny bit), but as it stands now I'm just waiting, not buying. Could there be many more like me, waiting instead of buying?

Oliver Levett

July 1, 2008, 3:36 pm

Aren't HTC doing the work for the X1 anyway? I know they're prepping the ROM as it contains HTC only apps (connection setup, HTCs own comm manager etc) and I think they're doing the hardware aswell...





SE are paying for it, but there not doing the R&D...





AS for release date, I thought it was late 2008/Q1 2009.

Luan Bach

July 2, 2008, 2:32 pm

SE has always been very poor at getting their high end phones to market. Remember the P990 anyone ? That took nearly 1.5 year from announcement to availability.

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