Device Arena

Q1 Highlights:
• Company returns to profitability in Q1 2010
• ASP rises to Euro 134 as Xperia™ X10 and Vivaz™ start shipping
• Improved cost structure generates better margins
The consolidated financial summary for Sony Ericsson Mobile Communications AB (Sony Ericsson)
for the first quarter ended March 31, 2010 is as follows:
Q1 2009 Q4 2009 Q1 2010
Number of units shipped (million) 14.5 14.6 10.5
Sales (Euro m.) 1,736 1,750 1,405
Gross margin (%) 8% 23% 31%
Operating income (Euro m.) -369 -181 20
Operating margin (%) -21% -10% 1%
Restructuring charges (Euro m.) 12 150 3
Operating income excl. restructuring charges (Euro m.) -357 -32 23
Operating margin excl. restructuring charges (%) -21% -2% 2%
Income before taxes (IBT) (Euro m.) -370 -190 18
IBT excl. restructuring charges (Euro m.) -358 -40 21
Net income (Euro m.) -293 -167 21
Average selling price (Euro) 120 120 134
Bert Nordberg, President, Sony Ericsson commented, “We are pleased to see the positive impact of
both the launch of new products and the business transformation programme improving the
company’s results. The Xperia™ X10, our first android-based Communication Entertainment device
featuring signature Sony Ericsson applications Timescape and Mediascape™, and Vivaz™, a
beautifully designed, touch-screen Symbian phone started shipping towards the end of the quarter.
Both models have been well received by global customers.” He added, “Increases in both gross and
operating margins show that we are on the right track to build the correct cost structure for our
business organization and strategy. We will continue to work through the transformation programme
to ensure that we are competitive.”
Units shipped in the quarter were 10.5 million, a decrease of 28% compared to the same period last
year, reflecting the streamlining of the portfolio over the past 12 months to focus on higher-end
phones. Sales for the quarter were Euro 1,405 million, a decrease of 19% year on year. Average
selling price (ASP) increased 12% both sequentially and year-on-year to Euro 134 during the quarter
due to good sell through of existing models, new flagship phones starting to ship at the end of the
quarter and a positive currency effect.

Gross margin rose both sequentially and year-on-year, reflecting a more favourable product mix and
the benefit of cost of sales improvements in the past year, including the resolution of certain royalty
matters during the quarter.
Income before taxes for the quarter excluding restructuring was a profit of Euro 21 million, illustrating
the positive impact of the cost reduction programme.

The transformation programme, which started in mid-2008, with the aim of reducing annual operating
expenses by Euro 880 million is continuing with the full benefit expected during the second half of
2010. Since the start of the programme, Sony Ericsson has reduced its global workforce by
approximately 3,150 people to reach a total of 8,450 by March 31, 2010. The total restructuring
charges taken to date are Euro 342 million.
As of March 31, 2010, Sony Ericsson retained a net cash position of Euro 563 million.
During the first quarter of 2010, Sony Ericsson obtained additional external funding of Euro 150
million. The funding was guaranteed by the parent companies on a 50/50 basis.
Market share in unit base for the quarter decreased by one percentage point sequentially and is now
estimated to be around 4%.
Sony Ericsson maintains a forecast of slight growth in units in the global handset market in 2010.

sony.net

The Sony Ericsson WebSDK is a suite of mobile development tools that allows both web and mobile developers to create applications for Sony Ericsson’s Google Android™ OS and Symbian Foundation phones.

Created in collaboration with the PhoneGap open source community, the launch of the Sony Ericsson WebSDK makes it possible to design applications for Sony Ericsson’s Google Android™ OS and Symbian Foundation devices starting with the newly announced XPERIA™ X10 and the recently launched Satio™.

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Sony Ericsson today unveils the XPERIA™ X10, the first phone in a family of phones to deliver a consistent user experience where communication truly becomes entertainment. Building on Sony Ericsson’s entertainment heritage and combining rich graphics with intelligence capabilities, the XPERIA™ X10 introduces a new UX platform that will evolve across the product portfolio and expand over time continuously introducing new features and capabilities.

The UX platform builds on top of the Open OS and creates a unique Sony Ericsson user experience by combining best-in-class entertainment features with signature applications, unrivalled integration of social media services and a rich graphical user interface. The XPERIA™ X10 is the first mobile phone to truly humanise the way people interact with their phones.

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Sony Ericsson today unveils the world’s first ever motion activated headphones that sense the user. The clever MH907 headphones mean users simply plug in two earphones to start listening to music and pause by removing one earbud. To start listening again simply plug it back in. Do exactly the same to answer and end calls – simple as 1,2,3!

Sony Ericsson’s SensMe™ Control technology responds without a single press of a button, and with a Clear Audio experience users encounter superior sound on the move and enjoy their favourite music as it’s meant to be heard.

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Today Sony Ericsson announces the XPERIA™ X2 a new Windows® phone that offers a best in class email and multimedia experience. In the modern world where 24/7 communication is key, users can instantly synchronise their mail and calendar and open and edit Microsoft® Office Mobile documents quickly and efficiently to stay connected with colleagues wherever they are.

The XPERIA™ X2 also includes the unique SlideView feature, which provides quick access to frequently used phone activities. Providing quick interaction with contacts, messages, media and more, SlideView gives an overview of missed incoming activity, notifying the user of any missed calls, e-mails and text messages so users don’t overlook an important contact.

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