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T610 fuels Sony Ericsson recovery

On the comeback trail

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Sony Ericsson has announced growth in sales, shipments and profits for Q4.

The firm, a joint venture between Swedish telecoms equipment maker Ericsson and Japanese consumer electronics company Sony, had struggled to make an impact on the market after its formation in 2001. However, the latest set of results, for the quarter ended in December 2003, indicate that the firm is on the comeback trail.

Units shipped in the quarter were eight million, 13 per cent higher than the same period last year, and also up from 7.1 million in Q3. Sales for the quarter were €1.437bnn, up 16 per cent year-on-year from €1.235bn. Sales in Q3, 2002 were €1,305 million.

Q4 income before taxes was €46m - which includes restructuring charges of € 9 million, relating to the final phase of previously announced restructuring of its American CDMA business and the GSM development unit in Munich, Germany. Net income was €43 million, which represents year-on-year improvements of €112 million. This follows on from a profit-making second quarter in 2003 and would seem to indicate the company is staging a comeback following some difficult times.

Sony Ericsson said the results reflect the continued success of the T610 series of handsets, the successful introduction of new products in Japan, and the launch of both high-end and entry-level phones for GSM markets.

"Following restructuring in the first half of the year, we have established a more solid operational platform. 2003 has seen Sony Ericsson further establish itself as an innovative and exciting new brand. We are optimistic that we can build on the success of the second half of 2003 with exciting new products like the P900, T630, T230 and our first two clamshell phones, the Z600 and Z200, as well as innovative products for the Japanese market," said Katsumi Ihara, president of Sony Ericsson.

Despite a reputation for good quality high-end handsets, Sony Ericsson struggled in the market following the merger of the two firms' mobile phone operations. At the time, analysts said its failure to launch successful mass-market entry-level phones led to it losing ground on its rivals. However, with the successful launches of the T610 and P800 handsets last year, the firm seems to have re-established itself.

A breakdown of the European market by Strategy Analytics late in 2003 found the Swedish-Japanese company climbing into fourth position in Europe, doubling shipments from 1.1 million to 2.2 million. Sony Ericsson's market share stood at 6.6 per cent, up from 4 per cent one year ago.

Meanwhile, figures released by Gartner in December for the global market found that despite dropping to the sixth spot in the league table, Sony Ericsson grew worldwide sales to 7 million units from 5.1 million units. Its market share stood at 5.3 per cent.

© ENN

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