Q2 Highlights:
. Income before taxes excl. restructuring charges increases to Euro 63 million
. Positive cash flow generated from operating activities
. ASP rises to Euro 160

The consolidated financial summary for Sony Ericsson Mobile Communications AB (Sony Ericsson) for the second quarter ended June 30, 2010 is as follows:

Q2 2009 Q1 2010 Q2 2010
Number of units shipped (million) 13.8 10.5 11.0
Sales (Euro m.) 1,684 1,405 1,757
Gross margin (%) 12% 31% 28%
Operating income (Euro m.) -274 20 36
Operating margin (%) -16% 1% 2%
Restructuring charges (Euro m.) 1 3 32
Operating income excl. restructuring charges (Euro m.) -274 23 68
Operating margin excl. restructuring charges (%) -16% 2% 4%
Income before taxes (IBT) (Euro m.) -283 18 31
IBT excl. restructuring charges (Euro m.) -283 21 63
Net income (Euro m.) -213 21 12

Average selling price (Euro) 122 134 160

Bert Nordberg, President, Sony Ericsson commented, "Our second quarter results show that the company continued the momentum seen in the first quarter as a result of our focus on the value market and the success of new smartphones; Xperia(TM) X10 and Vivaz(TM), launched during the first quarter. These models, along with the Xperia(TM) X10 mini and Xperia(TM) X10 mini pro which started shipping at the end of the second quarter, have been well received by operators and we are now well positioned for long term growth."

Sales for the quarter were Euro 1,757 million, a 25% increase sequentially and a 4% increase year-on-year. Units shipped in the quarter were 11 million, a 5% increase sequentially and a 20% decrease year-on- year due to the reduction in size of the product portfolio. Average selling price (ASP) increased 19% sequentially and 31% year-on-year to Euro 160 during the quarter due to improved product and geographical mix, as well as positive currency effects.

Income before taxes for the quarter excluding restructuring charges was a profit of Euro 63 million, illustrating the positive impact of the cost reduction programme and favourable product mix.

The transformation programme, which started in mid-2008 is now in its final stages and on target to reduce annual operating expenses by Euro 880 million by the end of the year. Since the start of the program Sony Ericsson has reduced its global workforce by approximately 4,000 people to reach a total workforce of approximately 7,800 by June 30, 2010. The total restructuring charges taken to date for the programme are Euro 374 million.

As of June 30, 2010 Sony Ericsson retained a net cash position of Euro 609 million, an increase of Euro 46 million sequentially mainly due to operating results, tight financial management of working capital, as well as positive currency effects.

Market share in unit base for the quarter remained flat and is estimated to be around 4%.

Sony Ericsson maintains a forecast of slight growth in units in the global handset market in 2010.

The liquid identity is a registered trademark of Sony Ericsson Mobile Communications AB.
Vivaz(TM) and XPERIA(TM) are trademarks of Sony Ericsson Mobile Communications AB.
Sony is a registered trademark of Sony Corporation. Ericsson is a registered trademark of Telefonaktiebolaget LM Ericsson.
Any rights not expressly granted herein are reserved and subject to change without prior notice.