Sony Ericsson is to cut a further 2,000 jobs off the back of a first-quarter pretax loss of EUR358 million. The new round of layoffs – which follows 2,000 previously announced cuts as part of another savings drive, now completed – was not expected by the market, although its widened first-quarter pretax loss was in the range of a warning issued last month.
Ericsson today reported a 35 percent fall in first-quarter net profit – due to weak results at its joint ventures Sony Ericsson and ST-Ericsson, as well as its own restructuring charges – but said the global economic downturn has so far had minimal effect on its core operation.
Sony and Ericsson are reportedly preparing for the possibility of having to secure new financing at their struggling handset joint venture, with analysts speculating each could have to make a capital injection of EUR500 million before the end of the year.
The latest figures from Gartner reveal that worldwide mobile phone sales totalled 269.1 million units in the first quarter of 2009, a 9.4 percent decline over the year-earlier period and the largest quarter-on-quarter contraction since Gartner began monitoring the market on a quarterly basis in 2001.