Sony Ericsson net profit falls 48 percent

By Freddie Pierce
While an earlier story published today suggested that the global automotive industry would suffer no major supply chain setbacks on the heels of the Ja...

While an earlier story published today suggested that the global automotive industry would suffer no major supply chain setbacks on the heels of the Japan disasters, Sony Ericsson announced Tuesday that first-quarter net profit fell 48 percent.

A year ago in the first quarter, Sony Ericsson reported net profit of €21 million, but that figure fell to €11 million for the same time period of 2011. The mobile handset maker forecasts modest growth throughout the rest of the year.

“The Japan earthquake made it a challenging quarter operationally and we are experiencing some disruptions to our supply chain,” Sony Ericsson CEO and President Bert Nordberg said in a statement.

According to Business and Leadership, however, Sony Ericsson’s pre-tax profit of €15 million still was greater than some analysts’ predictions that the company would be in the red come the end of the first quarter.

Revenues were still lower than expected, however, as Sony Ericsson sold just 8.1 million phones in the quarter, which contributed to Sony Ericsson’s lowest market share in almost 10 years. Sony Ericsson estimated its market share for smartphones during the first quarter was about 5 percent in units and 3 percent in value.


T-Mobile, Sprint merger means nothing without the Apple iPhone

Supply chain apps for smartphones released

The Top 5 warehouse management software vendors

Be sure to check out the latest issue of Supply Chain Digital

While the first quarter was tough for Sony Ericsson, there might not be an end to the struggle in the near future. According to Gartner analyst Carolina Milanesi, “the second and possibly third will be difficult (for Sony Ericsson) because of Japan.”

Still, CCS Insight analyst Geoff Blaber doesn’t think it’s all bad news for Sony Ericsson.

“This is a challenging situation for Sony Ericsson, but with lowered operating expenses and continued improvement to gross margin, it is at least in a better position to weather the storm than it was 12 to 24 months ago.”


Featured Articles

IBM: Supply Chain Data is Sustainability 'Blockage'

IBM study highlights sustainability disconnect between intention and impact, with 76% of execs agreeing it's crucial but just 30% making much progress

Heineken Toasts Success of Supply Chain Transformation

Digital transformations have a notoriously high failure rate but not so at Heineken, who has transformed its European logistics operations to great effect

GEP's Procuretech Advice, as new Scope 3 Reporting Laws Loom

GEP issues advice around mandatory Scope 3 reporting, an issue that will figure large at Sustainability LIVE: Net Zero, being held in London

Cainiao: The World's Largest Ecommerce Logistics Provider


FedEx Express Opens Singapore Logistics HQ


Supply Chain Problems Sees Partnerships Programme Grow