Sony Ericsson has posted a loss of €164m (£149m), but has told the industry that it is now better placed to enter the smartphone market.
Analysts blamed the firm's poor financial performance on the lack of a cheap phone with a Qwerty keyboard. Such phones tend to be the dominant choice among business users, and are increasingly popular with consumers.
Sony Ericsson said that, while its sales have fallen by nearly half compared to a year ago, the company has signed a $676m (£413m) financing deal in order to put market leading phones on sale.
Sales slumped to €1.6bn during the quarter from €2.8bn a year ago. The loss in revenue was due to a falling number of mobile phones shipped. Sony Ericsson shipped 14 million mobile phones in the period, compared to 26 million last year.
"We are now better positioned to support the launch of new products such as Aino and Satio in the fourth quarter of 2009. We have cleared channel inventories, and have continued to realign internal resources and improve efficiency," said the firm's outgoing president Dick Komiyama.
"We have also arranged external financing to strengthen the company's financial position. Transforming the business for future growth and returning Sony Ericsson to profitability is the focus of the senior management team, and will continue under the new leadership."
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