profits of sony ericsson drop 76pc

Sony Ericsson has reported handset volumes down 43 per cent and sales down 40 per cent for the quarter ended June 30, 2009, compared with the same period last year.

Its gross profit also took a nose dive in the first half of the year compared to the same period last year, from €1.440 billion to €346 million, a decline of 76 per cent.

Sony Ericsson shipped 13.8 million handsets globally in the quarter, down from 24.4 million, and posted sales of €1.684 billion, down from €2.82 billion in Q2 2008.

It said income before taxes fell from €8 million in the quarter in 2008 to a loss of €283 million. Sequentially, however, losses were stymied from the €370 million hit it took in the first quarter.

The average selling price per handset also increased by €6 to €122.

Sony Ericsson president Dick Komiyama said: "As expected, the second quarter was challenging and we still believe the remainder of the year will be difficult for Sony Ericsson.

"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."

He continued: "The new product portfolio that integrates communications, entertainment and social media applications should contribute to healthier topline development when shipments start later this year.

"We remain confident that the actions we are taking will further improve our financial situation and strengthen Sony Ericsson’s competitiveness."