Sony Ericsson is back in black.
After a string of quarterly losses, the struggling handset maker reported its first net profit since the second quarter of 2008. The bounce back was attributed to cost cutting and a refreshed portfolio. However, despite the profit, the company's sales fell in the quarter. In addition, Sony Ericsson said its CFO was stepping down.
The joint venture between Japan's Sony and Sweden's Ericsson posted a net profit of $28.4 million in the quarter, compared with a net loss of $396.8 million in the year-ago quarter. The company's gross margin rose to 31 percent, up from 8 percent in the year-ago period, and its operating margin stood at 1 percent, up from negative 21 percent.
Total sales for the quarter, however, were $1.89 billion, down from $2.35 billion in the first quarter of last year. Sony Ericsson shipped 10.5 million units in the quarter, down from 14.5 million in the year-ago period. Sony Ericsson's global market share now stands at 4 percent. The company's average selling price rose to $181, compared with around $162 in the first quarter of 2009. The company's first phone based on Google's Android platform, the Xperia X10, began shipping at the end of the quarter, alongside the Symbian-based Vivaz. The company has not named any U.S. carrier deals so far for its new devices.
Sony Ericsson has been implementing major restructuring and cost-cutting measures, in addition to refreshing its handset portfolio. The company decided in November to close its current North American headquarters as part of a broader effort to eliminate 2,000 jobs and cut costs. The firm combined its Latin America and North America regions into a single Americas region, which is headquartered in Atlanta.
Despite the cheer from the profit, Sony Ericsson said William Glaser Jr. will take over as CFO, effective immediately. He replaces Ulf Lilja, who has been CFO since 2005, and who will take a position at Ericsson at the end of July. Glaser is a former Sony vice president and headed Sony's Group Risk Office.
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