Sony Ericsson reported its first quarterly net loss in more than five years. The outfit lost  €25m in the third quarter, compared with a profit of €267m during the same period last year.

Dick Komiyama, Sony Ericsson's President, said the plan was to cut the company's handset range by 20 percent to raise profitability and reduce three handset development divisions into one to reduce duplication and improve efficiency. Sony Ericsson might also expand its €300m cost-cutting programme, which involves removing 2,000 jobs.

Komiyama said that consumer confidence is dropping faster than a team of parachuting elephants whose parachutes fail to open. Komiyama said that he hoped Sony Ericsson could return to profitable growth in the second half of next year.