Sony Ericsson score 358M EUR loss in Q1, but have a new high-ender in store for us this May
We are continuing our dreary Q1 results coverage and this time it's Sony Ericsson. The company has just announced all the Q1 details and they are quite bleak at first sight. With the economic turmoils the gadget-making business doesn't seem like something to take part in right now. But then again that holds true for almost every manufacturing branch these days.
Sony Ericsson report 358 million euro in losses before taxes this quarter and that's without counting all the restructuring charges. In case you're wondering, the "restructuring" included 2000 employees getting laid off, and there will be another 2000 on the chopping block soon, with 200 million euro more to be spent for "restructuring charges".
Despite the efforts Sony Ericsson market share is shrinking to 6 percent as compared to the 8 percent they had last quarter.
This is a direct result from 36% less shipments they accomplished this quarter than a year ago. It's quite in tune with their predictions for the global mobile market shrinking 10% this year. As we reported yesterday, Nokia is taking a pretty big hit too.
It's not all gloom and doom however - all this is within Sony Ericsson's predictions and they have plans in motion to ride out the rough patch. Their cost saving program for the first half of 2009 completed with 300 million euro saved and the restructuring charges were 113 million less than the estimates.
A new cost saving program targeting 400 million savings will go in operation and is to be completed by about the same time next year. Furthermore, they have 1.1 billion hard, cold cash in the bank (due to the positive net cash flow) so rumors of bankruptcy are unfounded.
Sony Ericsson have further plans to battle the losses - namely their Entertainment Unlimited product lineup, which focuses simultaneously on music, imaging, gaming and content services. The first Entertainment Unlimited phone to hit the market will be the Sony Ericsson W995 with Idou following in the second half of 2009.
And finally, the most intriguing news to all gadget-lovers out there - the next Sony Ericsson phones from the Entertainment Unlimited lineup will be announced on 28 May 2009.
For more numbers you can head down to the Sony Ericsson website.