Sony Ericsson records 16% fall in net income in 2Q05

The handset manufacturer claimed 7% share of the global handset shipments during 2Q, reporting that unit shipments grew 14% year on year from 10.4 million in 2Q04, to 11.88 million.

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By  Tawanda Chihota Published  July 16, 2005

Sony Ericsson has reported net income for the quarter to end-June fell Eur14 million (US$17 million) year on year to Eur75 million, and blamed the decrease on continued investment in R&D, as it recorded an increase in sales of 7% year on year to Eur1.61 billion in 2Q05. The handset manufacturer claimed 7% share of the global handset shipments during 2Q, reporting that unit shipments grew 14% year on year from 10.4 million in 2Q04, to 11.88 million. Sony Ericsson continues to work to broaden its product portfolio and is set to do more in the area of lower cost handsets aimed at emerging markets. The world’s leading handset manufacturer Nokia is set to announce its 2Q results on July 21. In 1Q05, the total mobile device sales volume achieved by the Nokia’s Mobile Phones, Multimedia and Enterprise Solutions business groups reached 53.8 million units, representing a year-on-year rise of 20% and a sequential decline, mainly due to normal seasonality, of 19%. Overall market volumes for the same period reached an estimated 170 million units, representing 20% annual growth and a 13% sequential decline. In smartphones, the total industry volume for the first quarter reached an estimated 10 million units, while Nokia's own smartphone volumes grew to 5.4 million units, compared with 1.8 million units in 1Q04. Based on volume developments during the 1Q05, Nokia said at the end of the first quarter that it expected the overall mobile device market for 2005 to reach about 740 million units, compared with its previous estimate of approximately 10% annual growth, from an estimated 643 million units in 2004. The overall market is also expected to grow in value, but to a lesser extent. Nokia predicted that volume growth is expected to continue to be driven by replacement and upgrade sales in more developed markets, with the availability of new features, services and cameras, and by new subscriber growth in developing mobile markets.

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