The troubled mobile phone joint venture company Sony Ericsson is to receive a €150m cash injection from each of its two parent companies to keep it afloat.
Rumours about the future of the joint venture have been circulating for a number of months as a result of poor performance and sliding market position.
The funding announcement was intended to reaffirm the commitment of Japan’s Sony and Sweden’s Ericsson to the joint venture.
The cash injection will occur during the quarter ending 31 March, 2003.
Sony and Ericsson has also announced its fourth quarter results ended 31 December, 2002.
Units shipped in the quarter reached 7.1 million, 4pc higher year-on-year and 42pc higher compared to the third quarter.
Net sales for the quarter were €1,235m, representing year-on-year and sequential increases of 18pc and 42pc respectively. Income before taxes in the quarter was €77m and net income was €69m, which represent year-on-year improvements of €75m and €70m, respectively.
Sony Ericsson estimates that approximately 115 million units were sold in the total market during the fourth quarter and approximately 395 million during the full year of 2002, compared with approximately 390 million in 2001.
Sony Ericsson forecasts that total market sales will be approximately 435 million units during 2003, representing year-on-year growth of about 10pc.
Sony Ericsson’s market share has stayed steady at around 5pc globally for the past year.
By Brian Skelly