Job cuts continue at Sony Ericsson, which plans to slash an additional 2,000 positions after posting a third straight quarterly loss. The company lost euro 293 million, or $385.9 million, in its first quarter compared to last year’s profit of euro 133 million. Excluding restructuring costs, the company lost euro 358 million.
The handset maker has been hit by plummeting worldwide consumer demand and destocking by distributors and retailers. Mobile phone shipments had a sequential decline of 40 percent, to 14.5 million phones from 24.2 million phones last quarter, and the company’s market share also took a hit, slipping to 6 percent from 8 percent last quarter.
“As expected, the first quarter of this year has been extremely challenging for Sony Ericsson due to continued weak global demand,” said company President Dick Komiyama in a statement. “We are aligning our business to the new market reality with the aim of bringing the company back to profitability as quickly as possible.”
Sales fell 36 percent to euro 1.74 billion from euro 2.7 billion last year, 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 percent. Europe remained the company’s highest-performing market, but sales in that region still fell 40 percent quarter over quarter. Asia was the company’s most steady market, where sales slumped only 12 percent from last quarter.
The company expects the global handset market to contract at least 10 percent in 2009, echoing guidance issued by Nokia earlier this week. Nokia also predicted a 10 percent contraction in the global market but expects to maintain its 37 percent 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.