Sony Ericsson has worse than expected Q3 earnings; phone shipments fall short of estimates

Despite being able to sell its high-end handsets, Sony Ericsson reported a smaller profit than expected and phone shipments overall were less than what analysts were hoping for. For the third quarter, Sony Ericsson reported a profit of  62 million EUR ($87.28 million USD) against analysts expectations of a 72 million EUR profit.

The company shipped 10.4 million handsets in the period, falling short of the estimates of  all 27 analysts surveyed by Reuters, whose guesses ranged from 10.5 million to 13.9 million units shipped. The average analyst estimate was for 12 million units to have left the factory vs, 11 million in the prior quarter. CEO Bert Nordberg said that the results were "stabilizing" and added, "Our strategy to focus on the smartphone segment is succeeding and smartphones now comprise more than 50 percent of our total sales."

Thanks to high-end phones like the Xperia X10, the Xperia X10 mini and the Vivaz, the joint venture was in the black after reporting 7 consecutive money losing quarters. The world's 5th largest cell phone manufacturer continues to pin its hopes on full featured smartphones with PC like features and links to social networking sites. The momentum is certainly behind the industry. While cell phone sales are expected to grow 11% this year, smartphone sales are expected to jump by 50%.

Still, Sony Ericsson has its work cut out for them with Samsung, Motorola, HTC and Apple all trying to eat from the same trough. The joint venture is gaining a reputation of announcing a high spec'd device and then delivering it so late that the specs are dated. This was the fate of the Xperia X10, which---as we reported- finally was able to get a carrier in the U.S. (AT&T) to subsidize the device, but only after several months had passed and the competition had been releasing newer, higher powered phones. Hopefully, by landing AT&T for the Sony Ericsson Xperia X10, the joint venture now has a U.S. carrier it can turn to for timely launches.

Sony Ericsson Xperia X10a Specifications | Review
Sony Ericsson Xperia X10 mini a Specifications | Review (X10 mini)
Sony Ericsson Vivaz a Specifications | Review (for AT&T)

source: Yahoo