Sony Ericsson slips from fourth to sixth place in global handset shipments

Sony Ericsson slips from fourth to sixth place in global handset shipments

Sony Ericsson fell from fourth to sixth place in global handset shipments in Q2 this year but saw its smart phone shipments soar by 15.4% in the same period.

An analysis of Sony Ericsson's Q2 shipments for 2010 by technology analyst iSuppli, published this week, reveal that while shipments rose 4.8% compared to the first quarter, rivals Research in Motion and ZTE surpassed Sony Ericsson due to larger growth rates.

The manufacturer's Q3 results out last week show the fall in global shipments continuing to fall by 5% on Q2.

However Sony Ericsson achieved a 15.4% increase in smart phone shipments during the second quarter making Sony Ericsson the fourth fastest growing smart phone brand during the second quarter.

The manufacturer’s fall in overall ranking and growth in the smartphone sector reflects the company’s strategic shift away from lower-margin, higher-volume products and toward more profitable devices, according to iSuppli

Tina Teng, senior analyst for wireless communications at iSuppli said: ‘With its shift in focus from volume to value-add, Sony Ericsson is positioning itself to cash in on the fastest growing and most profitable segment of the global wireless market. Given that cell phone penetration has reached 73.4% of the earth’s population, shipment growth is slowing markedly. Meanwhile, average pricing for mobile phones has declined to extremely low levels and will continue to decrease in the coming years. In contrast, smart phones and feature phones continue to offer fast growth and strong profit margins.’

Sony Ericsson smartphone sales have more than doubled in the second quarter compared to the same period last year, representing 13.6% of Sony Ericsson’s total mobile handset shipments in the second quarter of 2010.

Although the Average Selling Price (ASP) slipped by 3.8% in the third quarter compared to the second quarter, its gross margin and operating profit rose again. The company’s gross margins amounted to 30% in the third quarter, compared to 16% a year earlier. Sony Ericsson’s third-quarter operating profit market equaled 4%, up from 2% in the second quarter and a 4% decline in the third quarter of 2009.

Sony Ericsson’s smart phones sales made up more than 50 percent of its total sales in the third quarter.

Written by Mobile Today
Mobile Today

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