More bad news for Sony Ericsson

Sony Ericsson – the joint venture mobile handset manufacturer formed in 2001 on the promise of becoming ‘a world leader in global telecommunications’ – has reported a further widening in losses during the first quarter of the year as it loses more ground on runaway rival Nokia. The company reported a EUR113 million pre-tax loss for the three months to 31 March 2003, compared to the EUR77 million loss of the previous quarter. The results illustrate an alarming slide that has accelerated since the break-even result the manufacturer posted a year ago. Since then, falling handset prices and weaker sales have made Sony Ericsson the only loss-maker amongst the top five global handset manufacturers. It shipped just 5.4 million handsets in the quarter, down 400,000 year-on-year, and has seen the gap between itself and market leaders Nokia and Motorola widen as the big two reported sales growth of 13% and 18% respectively. Sony Ericsson’s market share now stands at around 6%, still well short of the 10% benchmark it set itself upon launch and similarly some way short of profitability. The vendor is now pinning its hopes to a new range of CDMA and camera phones, including the much-delayed T610, scheduled to start shipping in the coming weeks.