mmC Group

Mobile companies feel the effects of global recession

July 17, 2009

TWO of the world’s leading cellphone manufactures have projected that the effects of the global recession will continue to plague the players in the industry for some time.

Nokia and Sony Ericsson, which released their results for the first second quarter of 2009 on Thursday, where they revealed losses in income and drop in volumes shipped, expect the setback to continue in the current quarter.

“Nokia continues to expect 2009 industry mobile device volumes to decline approximately 10 percent from 2008 levels.

Nokia now expects its market share in mobile devices to be approximately flat in 2009, compared with 2008. This is an update to Nokia’s earlier target to increase its market share in mobile devices in 2009,’ the company says in a statement.

The sentiment comes after Nokia released a set of results that showed the company, which is the world’s biggest manufacturer of mobile phones, said net sales in the second half of 2009, net sales of EUR 9.9 billion were down 25 percent year on year while it shipped 103.2 million in the period, a 15 percent decline from the corresponding the year.

On the other hand, its rival, Sony Ericsson, said units shipped in the quarter were 13.8 million, a decrease of 43 percent
year-on-year and a sequential decrease of 5 percent. Sales for the quarter were Euro 1,684 million, a year-on-year decrease of 40 percent.

The company attributed this to challenging market conditions, which it forecasted to persist in the current year.

“Sony Ericsson maintains its forecast that the global handset market for 2009 will continue to contract by at least 10 percent from around 1,190 million units in 2008.”

Mobile phone companies have not been spared the effects of the global economic recession as consumers cut on their spending.