Sony Ericsson enjoys Q1 profit on new devices, employee cuts

Sony Ericsson posted a first-quarter profit of $29 million as the world’s fourth-largest handset manufacturer started to see traction from some of its higher-end devices, as well as benefit from cost-cutting measures previously introduced.
The manufacturer shipped 28% fewer devices in the quarter, but average selling prices increased 12% both sequentially and year-over-year to roughly $181. Sales for the quarter totaled $1.89 billion.
“We are pleased to see the positive impact of both the launch of new products and the business transformation program improving the company’s results. The Xperia X10, our first Android-based Communication Entertainment device featuring signature Sony Ericsson applications Timescape and Mediascape, and Vivaz, a beautifully designed, touch-screen Symbian phone started shipping towards the end of the quarter. Both models have been well received by global customers,” said Bert Nordberg, Sony Ericsson president in a prepared statement. “Increases in both gross and operating margins show that we are on the right track to build the correct cost structure for our business organization and strategy. We will continue to work through the transformation program to ensure that we are competitive.”
The company thinks sales could be up slightly in 2010, but noted that it lost 1 percentage point of marketshare during the quarter, and now counts about a 4% marketshare.
The company implemented its transformation program in mid 2008, and has sense cut its global workforce by more than 3,000. Today the handset manufacturer employs 8,450 people.