Sony Ericsson is keen to headline 2010 as a turning point in the firm's operations, following a torrid 2009 that saw the company post an operating loss of more than €1 billion.

And, on the surface, the stats are there to back such claims.

Operating profits for 2010 hit €159 million – a marked improvement – while profits in Q4 2010 alone came in at €39 million, up from a loss of €181 million the same quarter the previous year.

Net income for the year was €90 million, compared to a loss of €836 million in 2009.

Price rise

However, phone shipments in the most recent quarter and the full year have fallen.

Sony Ericsson shipped 43.1 million handsets to retail in 2010, 11.2 million in the last quarter.

In 2009, the figure was 57.1 million units throughout the 12 months and 14.6 million in Q4 2009.

As a result, sales fell from €6.79 billion in 2009 to €6.29 in 2010.

The difference between falling shipments and rising profits is, Sony Ericsson books more revenue per handset than it did in 2009.

Average selling price for the firm's phones then was €119, compared to €146 in 2010. Android seems to be the key to the company's rising RRPs, with 9 million Xperia phones having shipped since launch.

Market matters"2010 was a turnaround year for Sony Ericsson," said president and CEO Bert Nordberg.

"Our four consecutive quarters of profit reflect the success of our shift towards an Android-based smartphone portfolio.

"We will celebrate the 10th anniversary of the creation of Sony Ericsson in 2011, and as shown by the recently announced Xperia arc, we will continue to focus on delivering the most entertaining smartphones worldwide."

While the number of handsets Sony Ericsson ships might be falling, the company estimates global shipments for the market as a whole hit 1.2 billion in 2010 – a figure that gives Sony Ericcson a 4 percent share of the market.

The company ended the year with €375 million in cash. The negative cash flow from operating activities for the quarter was €128 million, mainly due to increases in inventory due to seasonal factors as well as payments related to the transformation programme.

[source: Sony Ericsson]