Sony Ericsson Q4 2011 results: 6 million Xperia phones shipped in quarter

by XB on 19th January 2012

in News

SESony Ericsson reported Q4 2011 net revenues of €1,288 million, a 16% drop versus a year ago and a 19% fall compared to the previous quarter. The company blamed the fall on a number of factors including intense competition, price erosion, weak macroeconomic conditions and the Thailand floods. This led to SE reporting an operating loss of €227m driven by lower margin (due to price competition) and higher R&D expenses.

Sony Ericsson said that 28 million Xperia smartphones had been shipped to date, an increase of 6 million units since the Q3 2011 results. In terms of sales, Xperia smartphones saw a 65% year-on-year (YoY) increase in sales during Q4 2011 and now contribute around 80% of sales. Overall it shipped 9m units altogether, around 5% lower than the previous quarter, mainly due to an exit of the feature phone business.

Q4 2011 ASP (average selling price) of €143 had declined since Q3 (€166). This is not what we would have expected considering that lower feature phones and higher smartphones should mean higher selling prices. The company put this down to intense price competition and no new product launches in the fourth quarter.

Sony Ericsson calculates its own Android market share at 10% in volume and 7% in value during Q4. In the past, Sony Ericsson has always talked about aiming to be the number one Android vendor, however, there were no such targets mentioned in this morning’s conference call. Perhaps, these targets are being reassessed by Sony following the acquisition of the Sony Ericsson joint venture.

Sony Ericsson Q4 2011 Results

You’ll notice in these graph, that there was a large decrease in Asia sales during Q4. This was in part due to a very strong Q3 in Japan attributed to the Xperia acro. However, more competitors are breaking into the Japanese market and price points are coming down, which Sony Ericsson says contributed to the decline in sales. Unfortunately there has been steep sales declines across all regions since early 2010, we would expect a large part of this is down to moving away from feature phones.

Sony Ericsson Q4 2011 Results

This chart below shows overall Sony Ericsson sales that show revenues have broadly held up – most likely to be smartphones propping up the decline in feature phone revenues.

Sony Ericsson Q4 2011 Results

Looking at this on a 12-month rolling basis and you can see that Sony Ericsson need to do a lot of work to arrest the decline in revenues overall.

Sony Ericsson Q4 2011 Results

Here you can see the ASP figures in Euros that were trending up (until the last quarter) mainly due to a much lower penetration of feature phones. Sony Ericsson confirmed that 80% of its Q4 sales came from smartphones. Sony Ericsson said that consumers had a preference for larger screen smartphones which was challenging the performance of the Xperia mini line. This could be the reason why the smallest 2012 Xperia leaked so far has a 3.5-inch display, rather than the 3-inch display of the Xperia mini or mini pro. This may be an ominous sign for Xperia mini fans, wanting a smaller Android handset.

Sony Ericsson Q4 2011 Results

The geographic sales mix over time shows some interesting trends. Asia has become a crucial segment for Sony Ericsson, whilst the Americas and CE, Middle East and Africa haven’t moved too much since 2009. Sales from Western Europe are a much lower part of the business mix (28 percent versus 41 percent in Q1 09).

Sony Ericsson Q4 2011 Results

Android Xperia shipments are trending up nicely, although we’re sure that Sony will be targeting more aggressive shipment numbers. The company also talked about the US market and said that it took longer than expected to release a targeted phone. Obviously we all know about the Xperia ion and SE said that now that the first phone has been developed with AT&T, the second and third phones should come around a lot quicker. CEO Bert Nordberg also said that they have found the Sony brand is stronger than Sony Ericsson in the United States, which should mean greater awareness on launch.

Sony Ericsson Q4 2011 Results

Via Sony Ericsson [PDF].

  • Wfaddah

    Yeah, and nerd needs to go. We need someone that would shake this company and focus more on what the customer wants. Not what they think might work.

  • Tubepleasure

    if they dont put the quardcore processor in their phone which should come up to the market on march 

    held the xperia s untill May  and launched  as a first phone 4 core that would be a deal 

  • Tubepleasure

    what obviously will not happen

    so that will not happen  their sale will not increase . Either you are first or out of the market like nokia  did not do  kick their ass on time lost market share  

    I bet that what Mr Sam-sh*t- sung will do with their Galaxy S

  • Samuel Serafim

    The most cheap SE phones was X10 minis and they have 2,55 pol. Its too little sure. 100% agree. They dont have superior hardware and they were very expansive. Why they didnt have benchmark on this? Of course it wont sell.
    The another se major phone is X play right? I think x play could be much more sexy and innovative.
    I do love Sony and Sony Ericsson, but this releases always sounds incomplete to me. And i think sony can force the prices to down. Here in Brazil, Xperia Ray and Neo have the same price of Xperia Arc. THE SAME. About 500 dollars. Where is the sense sony? 
    The Brazilian economy is the world’s 6th largest. This only happen in Brazil? I dont think so. Could Sony look with more affection for the South American market? Are prices around the world competitive? (…)
    I think 4Q 2011 portifolio is much better then 1Q 2011, so i think 2012 will be better. 
    I still wish the best for Sony, i love SE design and i will continue acquiring its products.

  • tymodmyt

    Dear XperiaBlog, there’s a misprint in the article:

    “…mainly due to mainly due to an exit…”

  • Anonymous

    Very few people care about quad core, nor is it likelt to make any noticible difference to your experience when using the phone.

  • Anonymous

    If they’s actually bothered to market or push the Xperia Pro, they might have had quite a few more sales for what is a rather under-recognised and underappreciated phone (e.g. In UK can only buy Xperia Pro online).

  • Anonymous

    Thanks for the spot!

  • Guest

    Dear SE, Please fight over the premium segment of the market. Your rather mid-range phones are very nice and reasonably priced. But they do have lower profit margins. ION and S are nice, but they might get overshadowed by the upcoming quadcores. I know we don’t need quadcore phones. But hey that’s what you said about the dual core last year. Having latest HW on your flagships will generate a lot more publicity and sales.

    All the best.

  • Alex

    I Second that. One more thing I’d like to add – in US android phones’ price drops pretty quick and most of high-end phones can bought for $0 on two year contract (with data plan) from third party websites like amazon, wirefly, letstalk, etc. So if you’re thinking your dual core phones will have a price advantage over quad cores (e.g. $100/$150 vs $200/$250), then you are probably wrong. Right after 2-3 months of their release, they all will be available for $0 (Forget about the official carrier prices, nobody buys phones from their websites). So no one will be buying your dual core phones once the other websites start offering quad core phones for $0 – $50. That means a pretty narrow product life and low sales. By putting the latest greatest HW on your phones, you can generate higher profit and longer product cycle.

  • Samuel Serafim

    wow very smart. 100% agreed.

  • Anonymous

    Please, no, do not infect the rest of the world with the US pricing model. Americans have a distorted sense of pricing due to only buying phones on rip-off contracts.

  • Guest

    Very nice post, Alex – fully agreed. I can’t help adding one more thing here.

    Dear SE, You also need to work on your product launch time. Q2 is too late for releasing phones with rather last yearish HW. I can bet that by releasing your dual core S/ION in January you could have two best sellers. I do appreciate the improvements they offer over Arc/Arc S (e.g. 720p HD screen, dual core, 12 MP camera, LTE). But phones with similar specs are already out (e.g. LG Nitro HD, etc.). Only 12MP camera won’t cut it in Q2 – trust me. In Q2, you better give us something with at least quad core, > 1 GB RAM, and a giant battery. It doesn’t matter if we need it or not. It matters if you want to stay profitable. A quad core chip will cost around $20/30 more. But you can safely charge $50 more on your end product to offset that. And as Alex said, it will also ensure longer product life and higher profit margin as well.

  • Awayagher

    Change your strategy Sony!

  • Xperia Pro + updated specs upgrade =


  • batman297

    Dear SE,don’t forget professional document viewing and editing features( word office,powerpoint,etc.) in your future smartphones.. ! :))

  • batman297

    Dear SE,I am a great fan of XPERIA ARC S AND XPERIA PRO..I think if you could come up with a smartphone that has the physical keypad(Querty) and PROFESSIONAL DOCUMENT VIEWING and EDITING(e.g.Word Office, Powerpoint,etc.) of Xperia Pro ,and the Entire features of Xperia Arc S ,and appearance of Xperia S – with 12MP CAMERA, QUADCORE CPU, ultra-HUGE “BATTERY life”,it would be a KILLER & HIT of ALL TIME,and you be “HITTING your PROJECTED TARGETS EXCEEDINGLY AMAZING” !!! :))

  • batman297

    ..with MICROSD expandable up to 32 GB..

  • Dmitri893

    They do not seem to know how to market themselves. For instance, having Manual Equalizers on stock player is a deal maker or breaker for audiophiles, especially if it’s from Sony. They implemented it on Xperia S, but in their product page, it’s not even mentioned as a feature. Like how they didn’t promote X10’s excellent optics but instead promoted the grainy 1st gen Exmor-R for mobiles heavily which really is no better than others in the market and certainly no N8 resulting in loss of people’s trust after their diluted Cybershot branding ordeal. Again. Marketing failures they are.

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