Handset maker Sony Ericsson said component shortages caused by the devastating March 11 earthquake in Japan were to blame for a marked decline in its second-quarter sales.
The company's handset shipments fell 31 percent year-over-year, to 7.6 million units, for the quarter ended June 30. Last year, the company shipped 11 million handsets.
"We estimate that the impact of earthquake-related supply chain constraints on our portfolio was close to 1.5 million units, with most of the effect in the early part of the quarter," Sony Ericsson President and CEO Bert Nordberg said in the company's earnings report.
However, Nordberg offered another explanation for the company's slumping sales in an interview with Bloomberg, telling the publication that the feature phone market is "collapsing much faster than I anticipated."
Sales in Europe, the Middle East and Africa fell by half over last year, and revenues in the Americas and Asia dropped 13 percent and 14 percent, respectively.
Sony Ericsson, a joint venture between Swedish infrastructure giant Ericsson and consumer electronics maker Sony, is in the process of phasing out its lower-end feature phones for more profitable smartphones.
Smartphones accounted for more than 70 percent of the company's sales during the quarter, and Sony Ericsson estimates it holds 11 percent of the global market for Android-based smartphones. Sony Ericsson said sales of its Xperia smartphones remained strong, with more than 16 million shipped to date. The average selling price of Sony Ericsson's phones slipped 3 percent year-over-year.
The strength of the company's smartphone portfolio was not enough to offset a decline in sales, which fell 32 percent over last year to $1.68 billion. The drop in revenue caused Sony Ericsson to lose money for the first time since the fourth quarter of 2009, and the company posted a net loss of $70.5 million.
Looking forward, Sony Ericsson maintained its prior forecast for "modest" growth in the global handset market for this year despite its disappointing second-quarter results.