Sony Ericsson profits soar on music phones

Compared to the same period last year the mobile phone manufacturer’s net income was up from EUR32 million to reach EUR109 million in the three months ending 31 March.

The Japanese and Swedish giant shipped 13.3 million units since January — a 41 percent increase on the 9.4 million units shipped in the same quarter last year. This translates as EUR1.9 billion in sales, representing a year-on-year increase of 55 percent.

The company said this was better than general market growth, but the figure is down 17 percent on the previous quarter. This sequential discrepancy between the fourth and first quarter may be explained by intense spending on consumer electronics in the run-up to Christmas.

Globally the fifth largest maker of mobile phones, the company reported a pre-tax income of EUR151 million based on strong sales and growth across all price points of its entire product range.

Alongside the better-than-expected financial results, Sony Ericson revised its expectations for the global mobile phone market upwards. It now forecasts sales of 900 million units. Its previous guidance was 10 percent growth on estimated 2005 market volumes of about 780 million units.

Sony Ericsson said it had released more new products during the first quarter than in previous years. It applied the popular Walkman brand to its music phones and 2.5 million Walkman models shipped last year.

Sony Ericsson’s competitor Motorola experienced similar success with its popular Razr branding and the market may see more individualised product lines if this trend continues.

Sony also added the Cyber-shot branded camera phones in its portfolio.

The London-based joint venture of Japan’s Sony Corporation and Sweden’s LM Ericsson announced its current average selling price across all ranges was EUR149 — a 4 percent increase. The company claims this reflects higher-end products entering the product mix for big Japanese network operators.

“We are beginning to deliver the differentiation in our product portfolio which Sony Ericsson promised at the start of the joint venture,” said company president Miles Flint.

Sony Ericsson trails LG Electronics, Samsung, Motorola and Nokia in terms of global mobile phone market share.

Tags: LG, Motorola, Nokia, Samsung, Sony Ericsson

This entry was posted on April 18th, 2006 and is filed under Brands. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or Trackback from your own site.