Sony Ericsson plans 2,000 job cuts after steep drop in 2Q profit
Posted July 18, 2008 8:39 a.m. EDT
Updated July 18, 2008 11:04 a.m. EDT
STOCKHOLM, Sweden — Mobile phone maker Sony Ericsson is reporting a steep 97 percent drop in second-quarter earnings as tougher market conditions hurt its sales.
Net profit at the joint venture of Tokyo-based Sony Corp. and Stockholm-based LM Ericsson fell to 6 million euros ($9.5 million) in the quarter from 220 million euros in the same period a year ago.
Sales were down about 9 percent to 2.8 billion euros ($4.4 million).
The joint venture had warned before Friday's report that it expected to just break even because of tougher market conditions.
Sony Ericsson operates a research and development center in Research Triangle Park, N.C. It employs some 750 people.
The company plans to lay off some 2,000 people, including contractors, Dick Komiyama, the firm’s president, said in a conference call.
The quarterly results, downward price pressure and slowing demand for its high-end multimedia phones led to that decision, he said.