10/21/2009 11:37:00 AM
Losses hit Nokia and Sony Ericsson in third quarter
Nokia and Sony Ericsson have reported another quarter of consecutive losses, although both issued a more positive outlook for the remainder
of the year.
The companies released their results for the third quarter ended 30 September last week, with Nokia reporting a steep loss of £391m, compared with a profit of £1.3bn one year earlier.
Meanwhile, Sony Ericsson revealed better than expected losses of £150m, compared with a £258m loss in Q2 2009, as the effects of its £802m per year cost-cutting plan started to show.
However, while Nokia said the handset market was going to decline by 7% in 2009, rather than its original forecast of 10%, Sony Ericsson repeated its prediction that the global market would decrease by 10% this year – although it admitted the decline was slowing.
Sony Ericsson’s average selling price rose to £104 from £99 one year earlier, but the number of units shipped fell to 14.1 million from 25.7 million.
Nokia shipped 108.5 million devices during the period, down 8% year on year but up 5% on the previous quarter. The average selling price per unit was £57, down from £66 the previous year.
Strategy Analytics’ head of wireless practice, Neil Mawston, said: ‘Nokia’s revenues and shipments were in line with expectations, but its smartphones were below and its market share is collapsing.’
He added: ‘Sony Ericsson is not going up as fast as expected. Greater competition from RIM, Apple and others, and a lack of a portfolio refresh in Q3 hit the manufacturer. It has a lack of smartphones, touch phones and QWERTY phones.’
Nokia and Sony Ericsson tend to do well in the holiday season, as consumers buy low-cost candybar handsets as presents. Mawston said increased marketing budgets in Q4 should show ‘slight improvement’. He added: ‘The product is key – they are both struggling in high-end phones.’