Mobile phone maker Sony Ericsson posted a smaller-than-expected third-quarter loss yesterday and said cost cuts were going according to plan, but analysts said the outlook was still shaky.
The world No. 5 handset maker, which is suffering as economic anxiety causes consumers to scale back phone purchases, lost $31 million U.S. in the quarter. That included a 35-million euro restructuring charge.
The result compared with forecasts for a 72-million euro pre-tax loss, according to a Reuters poll of 24 analysts, and with pretax profit of 384 million euros a year earlier.
Sony Ericsson, owned by Ericsson and Sony Corp., said market conditions remained challenging.
"Overall, the report was marginally better than expected (but) the outlook ... seems rather uncertain.
"Their new products are not as exceptional as they were a couple of years ago, compared to their competitors," said Greger Johansson, analyst at analysis firm Redeye.
"Next year is the question mark for the whole industry," said Hannu Rauhala, analyst at Pohjola.
Sony Ericsson president Dick Komiyama, asked whether the company might need to do more cost-cutting if conditions stayed weak, he said he thought cost plans looked "good enough" right now.
"Next year is the question mark for the whole industry," said Hannu Rauhala, analyst at Pohjola.
The company, which has issued two profit warnings this year, has set out to knock off 300 million euros from operating expenses with full effect in the second half of 2009.
Nokia Oyj is the clear leader in cellphone units shipped, followed by Samsung Electronics Co Ltd, Motorola Inc and LG Electronics Inc.
Source : http://www.canada.com/
