WorldWide Tech and Science. Francisco De Jesús.
Sony Ericsson announced mixed news for the second quarter of 2011, with supply chain constraints resulting from the Japanese earthquake “significantly” impacting its Q2 results, but with the company also capitalising on growth in the smartphone market.
However, the period also saw the company going into the red, after a number of positive quarters: it reported a net loss for the period of EUR50 million, compared with a prior-year profit of EUR12 million, on sales of EUR1.19 billion, down from EUR1.76 billion.
The company also reported a negative cash flow from operations of EUR224 million, which was attributed to “increases in accounts receivables and inventories, negative net income and timing of certain payments.” New external borrowing of EUR165 million was made during the quarter, resulting in total borrowing of EUR769 million at the end of the quarter. Its total cash balance at 30 June stood at EUR516 million.
During the quarter, the company shipped 7.6 million units, down from 11 million in the prior year's three-month period, with the company noting an anticipated drop in feature phone shipments. Bert Nordberg, President and CEO (pictured), said: “We estimate that the impact of earthquake-related supply chain constraints on our portfolio was close to 1.5 million units, with most of the effect in the early part of the quarter.” Sony Ericsson said that smartphones now represent more than 70 percent of its total sales, with volumes of its Android-based Xperia line up 150 percent year-on-year.
The company has introduced eight new Xperia devices this year, and it “continues to see strong consumer and operator demand” across this portfolio. It estimates that its share of the global Android handset market was 11 percent, in both value and volume terms. Sequentially, it saw an increase in average selling prices to EUR156 from EUR141, which it said was attributable to a favourable product and geographic mix.