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Ericsson affirms forecast
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August 4, 2000: 8:25 a.m. ET
Firm repeats mobile phone sales estimate, declines to predict its share
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NEW YORK (CNNfn) - Swedish telecom equipment maker Ericsson Friday upheld its 2000 industry-wide mobile phone sales estimate of 400-440 million units, but said it could not give its own market share forecast.
"We will not reach a 15 percent market share this year but, as we have said before, we are not focusing on market share but on profitability now," Pia Gideon, Ericsson vice president and head of communications, told Reuters.
"In the first six months of the year we have sold 20.7 million units. I cannot give a forecast of our market share for the whole year," she said.
Gideon also said she could not confirm a Swedish newspaper report quoting Ericsson spokesman in New York, Gary Pinkham, as saying the company would sell between 45 and 50 million units this year.
"The figures are not familiar to us. We stick to what we said before," Gideon said.
Ericsson's (ERICY: Research, Estimates) consumer products division, mainly mobile phones, was the only one to post an operating loss, of 1.8 billion krona ($193.9 million) in the first six months of the year.
 The company blamed the poor performance of the unit, which constitutes some 20 percent of Ericsson's otherwise booming business, on a fire in a Philips NV plant in the U.S., which produces key components.
"In March we had a very unfortunate accident with one of our suppliers of components, and that has hit us and that has reduced the volume that we have been able to ship to the market during the second quarter. And unfortunately, we will not recover in the third quarter either," Ericsson President Kurt Hellstrom told CNNfn in an earlier interview.
The news comes on the heels of Thursday reports that rival Motorola (MOT: Research, Estimates) told its suppliers that it would produce fewer handsets than it previously had forecast.
However, a Motorola spokesman denied the reports, and said it had no such conversation with suppliers and that its forecast for sales of mobile phones this year remains unchanged.
"There was no conference call last night, we have not changed our guidance to analysts, nor have we told our suppliers anything different than we have for the last 30 days or so," Motorola spokesman Rusty Brashear said. "At our analyst meeting, we projected that sales of handsets would grow 25 to 30 percent in the second half, on a dollar basis."
At a Motorola analysts meeting Tuesday, the company said the industry's
worldwide sales of mobile phones are likely to be between 425 million and 450 million units in 2000. Motorola sold 50 million to 55 million phone handsets last year, and said that its unit volume rose 50 percent in the first half of 2000 from the year earlier.
In Thursday trading, Ericsson shares closed down 1/16 to 18-1/16, while Motorola declined 11/16 to 35-15/16, recovering from a sell-off earlier in the day. 
-- from staff and wire reports
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Ericsson
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