Sony Ericsson is cutting a further 2,000 jobs in a bid to save another 400m euros, after reporting a loss of 358m euros (£316m) for the first quarter ended 31 March. The job losses are in addition to the 2,000 it announced last year.
The company announced plans to save 300m euros in June last year, which resulted in an initial 2,000 job cuts. The programme cost a total of 180m euros, bringing a total cost saving of 880m euros to be made by 2010.
The manufacturer saw a decrease of 35% in units shipped during the first quarter of 2009 to 14.5 million. Sales for the quarter were down by 36% to 1.7bn euros (£1.5bn), which it blamed on continued weak consumer confidence and destocking in retail and distribution.
Sony Ericsson president, Dick Komiyama, said: ‘As expected, the first quarter of this year has been extremely challenging for Sony Ericsson due to continued weak global demand. We are aligning our business to the new market reality with the aim of bringing the company back to profitability as quickly as possible.’
On 20 March, Sony Ericsson warned that it would post a £370m loss for the first quarter of 2009.
CEO Dick Komiyama’s prediction in the final quarter of 2008 that the handset market would contract by 5% in 2009 has now doubled to 10% - the same level of decline forecasted by Nokia.