Sufferin’ Sony! Profits Plunge 97 Percent

For the second quarter in a row, Sony Ericsson suffered an unwelcome drop – 97 percent – in profit as the weak economy continued to drain the company’s coffers. Losses among telecom equipment makers haven’t caught anyone off guard the past few quarters. But this one is staggering, especially compared to the less-frightening 48 percent fall in net income Sony Ericsson reported for the first quarter of 2008. Not surprisingly, Sony Ericsson is cutting jobs – 2,000 people are expected to get pink slips. “We are aligning our operations and resources worldwide to meet an increasingly competitive business environment and to help restore our capability for profitable growth,” Dick Komiyama, president of Sony Ericsson, said in a prepared statement. “We estimate that our restructuring charges will be of the same magnitude as our reduction in operating expenses, and we will incur such charges as our measures are implemented.” Sony Ericsson's struggles further beg the question -- how bad will 2Q earnings news be for competitors Nokia, LG and Motorola? Stay tuned.

eWeek: Sony Ericsson Cuts 2,000 Jobs

Forbes: Sony Ericsson Needs to Act:

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