Q4 Highlights:
* Year-on-year volume & sales growth of over 60%
* Income before tax up 144% year-on-year
* Hit products drive market share gains
2006 Highlights:
* Volume & sales grow to 74.8 million units and 10,959 million Euros respectively, double the global market growth rate
* Income before taxes grows to 1,298 million Euros
* 60 million music enabled phones, including 17 million Walkman phones sold
* Strong growth in Latin America, Asia Pacific and Europe
Sony Ericsson says it increased market share during Q4 2006 due to the continued success of products such as the K800/K790 Cyber-shot phone and Walkman phone line-up. Average Selling Price (ASP) was slightly higher than expected due to more favourable than expected market conditions and continuing strong demand for Sony Ericsson’s hit model handsets. Particularly strong growth in emerging markets in Latin America and Asia Pacific, as well as in Europe, is claimed to illustrate Sony Ericsson’s success at expanding the portfolio to increase market share in new markets with attractive mid-tier products, and without undermining profitability.
Units shipped in the quarter reached 26.0 million, a 61% increase compared to the same period last year, generating significant year-on-year market share gains. Sales for the quarter were Euro 3,782 million, representing a year-on-year increase of 64%. Income before taxes for the quarter was Euro 502 million representing a year-on-year increase of 144%. Net income for the quarter was Euro 447 million.
“The fourth quarter saw Sony Ericsson finish a strong year with record volumes, sales and net income due to the soaring popularity of our imaging and music phones. Earlier investments in R&D and marketing have enabled us to expand the portfolio and strengthen the brand to increase consumer and operator appeal. Our target is to become one of the top three players in the industry, and the momentum we established in 2006 makes this an achievable ambition,” said Miles Flint, President of Sony Ericsson.
Sony Ericsson estimates the 2006 global handset market as being around 980 million units, higher than previous forecasts of over 950 million units for the year. On this basis the company believes it has outperformed the market during the quarter, gaining around 1% of market share sequentially, to achieve a global market share of approximately 9% during Q4. In Q4 2006 Sony Ericsson grew market share slightly over 2% against the same period for the previous year.
During the fourth quarter Sony Ericsson announced it had reached agreement in principle to acquire the Swedish software company UIQ Technology AB, a wholly owned subsidiary and business of Symbian Ltd. The company expects the transaction to be completed during the first quarter 2007.