Japan is home to many Tech manufacturers, including the most Android-friendly Sony Ericsson. Many lost loved ones during and after the March 11 disaster in Japan, and we knew this catastrophe would hit Japan’s economy as a whole. Sony Ericsson has just reported its Q2 losses, and the company claims to still be suffering from the devastation of Japan’s last earthquake/tsunami.
Before this year, Sony Ericsson was in a continuous profit spree for 5 quarters. Losses were last reported was during the final quarter of 2009. But for Q2 of 2011, Sony Ericsson has reported a pretax loss of €42 million ($59.5 million U.S. dollars); however, they do claim their profits will be going upwards during the second half of the year.
There might be some minor spillover. In our planning this is behind usBert NordbergChief Executive of Sony Ericsson
To be more exact about the losses, Sony Ericsson sold 7.6 million phones during Q2. This may sound like a huge number to us, but it is a substantial loss compared to the 8-11 million quarterly sales the company is used to. The company did face a 1.5 million device deficiency, mostly due to supply shortages (due to the disaster) for “expensive models,” which definitely includes Android devices. This loss is equivalent to €400 million (over $550 million U.U. dollars).
Despite the losses, Sony Ericsson is planning to see better numbers during the second half of 2011. It seems supply shortages are no longer as considerable, and changes of a similar report would be “negligible” during the third quarter.
The product portfolio looks pretty good ahead of the second half, and if they manage to increase volume by a couple of million units they should be making profits for the rest of the year -- not large profits, but a bit above zero where we thought they would beHakan WranneAnalyst at Swedbank Markets
Such bad timing for a disaster (not that there is ever a right time), especially when Sony Ericsson was planning to commit highly to the Android platform and to improving their devices. But Mother Nature doesn’t consider time, and when she hits, she hits.
For now, you can support Sony Ericsson if you’re looking for some good Android devices. Their products have been majorly improved compared to their 2010 products. Sony Ericsson has some very competitive smartphones and is also jumping on the tablet bandwagon with the S1 and S2 tablets. The new smartphones include the Xperia Play (aka the PlayStation phone), the Xperia Arc, Xperia Neo, Xperia Pro and the new Xperia Minis. They’re worth a look if you’re in the market for a new smartphone. What do you guys say? Will you be purchasing one of these devices anytime soon? Do you think Sony Ericsson’s numbers will be going up anytime soon?