Sony, Ericsson pump $325M into cellphone venture

Zardon · Jan 29, 2003, 05:32 PM

Japan's Sony Corp. and Sweden's Telefonaktiebolaget LM Ericsson will pump €300 million (US$325 million) into their mobile telephone handset joint venture over the next three months in an attempt to shore up the loss-making company's finances and support expansion, they said Wednesday.

The two will each invest €150 million to increase the capital of Sony Ericsson Mobile Communications AB, which on Wednesday reported losses had roughly halved and revenues were up slightly in the last three months of 2002.

During the final quarter of last year, the company shipped 7.1 million mobile handsets. That represents a 4 percent increase on the same period a year earlier and a 42 percent increase on the third quarter, according to the company.

Based on the company's own total market estimate of 115 million units, the figure translates to a roughly 6.2 percent share of the global market during the fourth quarter. Analysts put Sony Ericsson's market share during the third quarter at 4.8 percent.

The company attributed its increasing market share to an expanding product line.

"Last year we were introducing products but we didn't have a complete product line," Pia Gideon, a spokeswoman for Ericsson in Stockholm said. "Sales were mainly driven by the T68, which was very successful in Sweden and all over Europe, but it's not enough to have just one product. We are gradually launching more and more products and in the end of the fourth quarter launched the P800, which is our camera-phone."

During the fourth quarter, net sales totaled €1.2 billion, an 18 percent increase over the same period a year earlier. Pretax losses ran to €77 million and net losses were €69 million, both of which are around half of what they were a year earlier, the company said.

Sony Ericsson is expecting to become profitable in 2003, Gideon said, and also expects to expand its market share. That will mean achieving unit sales growth of more than 10 percent, which is the company's estimate for the total market in 2003. It said it expects the entire market to increase from 395 million units sold in 2002 to 435 million this year.

Jan 29, 2003, 05:32 PM	#1
Zardon DriverHeaven Founder Join Date: May 2002 Posts: 32,480 Rep Power: 179	Sony, Ericsson pump $325M into cellphone venture Japan's Sony Corp. and Sweden's Telefonaktiebolaget LM Ericsson will pump €300 million (US$325 million) into their mobile telephone handset joint venture over the next three months in an attempt to shore up the loss-making company's finances and support expansion, they said Wednesday. The two will each invest €150 million to increase the capital of Sony Ericsson Mobile Communications AB, which on Wednesday reported losses had roughly halved and revenues were up slightly in the last three months of 2002. During the final quarter of last year, the company shipped 7.1 million mobile handsets. That represents a 4 percent increase on the same period a year earlier and a 42 percent increase on the third quarter, according to the company. Based on the company's own total market estimate of 115 million units, the figure translates to a roughly 6.2 percent share of the global market during the fourth quarter. Analysts put Sony Ericsson's market share during the third quarter at 4.8 percent. The company attributed its increasing market share to an expanding product line. "Last year we were introducing products but we didn't have a complete product line," Pia Gideon, a spokeswoman for Ericsson in Stockholm said. "Sales were mainly driven by the T68, which was very successful in Sweden and all over Europe, but it's not enough to have just one product. We are gradually launching more and more products and in the end of the fourth quarter launched the P800, which is our camera-phone." During the fourth quarter, net sales totaled €1.2 billion, an 18 percent increase over the same period a year earlier. Pretax losses ran to €77 million and net losses were €69 million, both of which are around half of what they were a year earlier, the company said. Sony Ericsson is expecting to become profitable in 2003, Gideon said, and also expects to expand its market share. That will mean achieving unit sales growth of more than 10 percent, which is the company's estimate for the total market in 2003. It said it expects the entire market to increase from 395 million units sold in 2002 to 435 million this year.