Sony Ericsson slims loss but still in the red

Sony Ericsson has posted a lack lustre Q3 result, but has slimmed its losses with a quarterly pretax loss of €199 million.

The vendor reported a €283 million loss in the second quarter but compared to the same period last year of  a €25 million loss, the result still represents a blow out.

"The reduced loss was due to better gross margin, as well as reduced operating expenses," Sony Ericsson said in a statement.

Sales in the quarter fell more than 40% to €1.6 billion, compared with € 2.8 billion in the same period in 2008. Units shipped in the July-September period amounted to 14.1 million, up 2% on the last quarter, but down 45% on the year.

In April, Sony Ericsson announced it would slash 2,000 jobs, on top of 2,000 jobs cut last year, to lower costs. In total, it aims to cut operating costs by €880 million, with full effect of the measures expected in the second half of next year.

The company retained its negative forecast with a gloomy prognosis for the market this year, claiming that it anticipates a further contraction of about 10%.

Sony Ericsson, has signed loan facilities of €455 million euros to strengthen its balance sheet and improve liquidity.

The vendor said €155 million had been drawn down by the end of September and €100 million were drawn down at the beginning of October.