Mobile handset market continues to collapse

20 April 2009, 10:57am

Maisie Ramsay reports in WirelessWeek (April 17, 2009) that job cuts continue at Sony Ericsson, with plans to cut an additional 2,000 positions after posting a third straight quarterly loss.

The handset maker has been hit by plummeting worldwide consumer demand and de-stocking by distributors and retailers. Mobile phone shipments had a sequential decline of 40%, to 14.5 million phones from 24.2 million phones last quarter, and Sony Ericsson's market share also took a hit, slipping to 6% from 8% last quarter.

The company expects the global handset market to contract at least 10% in 2009, echoing guidance issued by Nokia earlier this week. Nokia also predicted a 10% contraction in the global market but expects to maintain its 37% market share thanks to sales in emerging markets and its recently beefed-up line of smartphones. The company shipped 93.2 million units in the first quarter, surpassing analysts’ shipment estimates of 90 million units.

The company lost 293 million euro ($385.9 million) in its first quarter compared to last year’s profit of 133 million euro. (Excluding restructuring costs, the company lost 358 million euro.) Sales fell 36% and the average sale price per unit declined slightly, to euro 120 compared with euro 121 last quarter.

Declines were the steepest in its North American and South American markets, where sales sequentially fell 69%. Europe remained the company’s highest-performing market, but sales in that region still fell 40% quarter over quarter. Asia was the company’s most steady market, where sales slumped only 12% from last quarter.

Read the full article at Wireless Week

Geo: International