Sony Ericsson was hammered in the last quarterly earnings.
January 19, 2012- A decline in sales was blamed for Sony Ericsson reporting a fourth quarter loss. Sony Ericsson Mobile Communications, a joint venture being purchased by Sony Corp., announced a quarterly loss, its second in a year. Competition has increased in the Android mobile device market the company said.
Net loss for the last quarter of 2011 was reported at $266 million compared to over a $10 million profit in the same quarter a year ago. Analysts predicted a profit of over $16 million. Sales fell by over 16% and that missed estimates of analysts as well.
In October, Sony agreed to purchase Ericsson’s share in the joint venture of 10 years for over $1.30 billion to enter the consumer smartphone electronics market following a decline in its television business. Sony’s aim is to compete against Samsung and other companies by integrating its smartphone business with home electronics like the Xperia consoles.
Bert Nordberg, Chief Executive of Sony Ericsson based in London said, “The results of the fourth quarter reflect the increased competition and unfavorable economic conditions.” He added, “The production interruption due to the Thailand floods last fall also was a factor.”
Sony announced that its acquisition should be complete between January and February after getting its needed regulatory approvals. Nine million handsets were shipped by Sony Ericsson in the fourth quarter, a decrease of 20% over the previous year.
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