Sony Ericsson Posts Fourth Consecutive Quarterly Loss

Company specializes in mid-range mobile handsets such as its Walkman Cybershot line of feature phones.
Sony Ericsson continues to struggle, and its decreased shipments and sales led to a loss of about $300 million for the second quarter.

The company specializes in mid-range devices such as its Walkman or Cybershot line of feature phones, and this segment has been especially hard hit by the mobile industry's decline. The company shipped 13.8 million units for the period, which was down 43% from the same quarter last year.

The cell phone maker did improve its operating margins in part due to a massive restructuring effort that is predicted to save about $522 million in costs. Like Nokia, Sony Ericsson sees the mobile market declining by about 10% in 2009 due to the global economic recession.

"As expected, the second quarter was challenging and we still believe the remainder of the year will be difficult for Sony Ericsson," said the company's president Dick Komiyama in a statement. "Our focus remains on bringing the company back to profitability and growth as quickly as possible, and our performance is starting to improve due to our cost reduction activities."

During its conference call Thursday, the company said it would likely need a capital injection in the second half of the year. Sony Ericsson said financing should not be an issue, and this could come from its parent companies Sony and Ericsson, or from outside sources.

The company introduced three high-end phones during the quarter, but these devices aren't scheduled to be released until the fourth quarter. The Satio, Yari, and Aino do represent the direction the company is taking its handsets, as each phone has strong multimedia capabilities and one even has deep integration with Sony's PlayStation 3.

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