Sony Ericsson Phone Estimates Disappoint

Shares of Ericsson are falling nearly 13%.
Author:
Publish date:

Shares of

Ericsson

(ERIC) - Get Report

were falling Wednesday after the cell-phone maker warned that lower growth in the first quarter would likely hurt its earnings.

Sony Ericsson, the joint venture of

Sony

(SNE) - Get Report

and Ericsson, said it would ship 22 million handsets during the quarter, falling short of estimates that shipments could be as high as 26 million. Sony Ericsson estimated that the average selling price per handset would be 120 euros, which is expected to generate net sales lower than the first quarter of 2007.

Ericsson was dropping nearly 13% in the premarket session to $16.90. Sony was off 0.2% to $41.75.

Dick Komiyama, the president of Sony Ericsson, said in a release that the market "is proving to be challenging. This has been more pronounced in the mid-to-high end replacement sector of the market in Europe, where Sony Ericsson has stronger-than-average market share."

Other handset makers were trading lower in sympathy.

Nokia

(NOK) - Get Report

was falling 5.4% to $30.96, and

Motorola

(MOT)

was off 0.5% to $9.69.