Mobile handset maker Sony Ericsson today reported a net loss of 207 million euros ($266 million) in the October-December quarter of 2011 due to intense competition, price erosion and restructuring charges.
The company's sales fell to 1.28 billion euros in the fourth quarter ended December 31 from 1.52 billion in the year-ago period, Sony Ericsson said in a statement.
"Our fourth quarter results reflected intense competition, unfavorable macroeconomic conditions and the effects of a natural disaster in Thailand this quarter," Sony Ericsson President and CEO Bert Nordberg said.
"...In spite of these challenges, throughout 2011 we have shifted our business from feature phones to smartphones, and our Android-based smartphone sales in the quarter increased by 65% year-on-year. The Xperia portfolio, including the recently announced Xperia NXT series, will serve as a cornerstone of our smartphone lineup in 2012," Nordberg added.
Sony Ericsson shipped 9 million handset during the quarter, a 20% decrease year-on-year and a 5% decline compared to last quarter.
"The declines reflect a significantly lower number of feature phones shipped, partially offset by an increase in smartphone shipments," the company said.
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Sony Ericsson estimates that the global smartphone market for the full year 2011 surged by 60% in volume to 463 million units. It expects that strong growth in the smartphone market this year as well.
The company faced restructuring charges of 93 million euros during the fourth quarter, due to a restructuring programme initiated in December that included workforce reductions.
The quarterly report is most likely the last before electronics giant Sony Corp takes full control of the company.
In October, Sony agreed to purchase Ericsson's stake in the 10-year-old joint venture for 1.05 billion euros in aim to tap the demand for smarter consumer electronics after its main television business declined.
For the year ended December 31, 2011, Sony Ericsson registered a net loss of 247 million euros and 5.21 billion euros in sales during the same period.