In the first three months of the year, the group registered a net profit of €133 million ($212 million), down by 47.6 percent from €254 million a year earlier.
Sales dipped by 7.6 percent in terms of value to €2.7 billion during the period.
Sony Ericsson, the world’s fourth-biggest mobile phone manufacturer, sold 22.3 million handsets during the period at an average selling price of €121, compared to 21.8 million at €134 last year.
The drop in sales, which was expected after the group issued a profit warning in March, was attributed to shrinking demand for mid- and high-end mobile phones on the company’s main market, Europe, amid an economic slump.
In the first quarter, the group also suffered from a shortage of parts for the company’s much in demand mid-end phones.
Sony Ericsson said however that it expected a recovery in the second half of the year.
“Sony Ericsson continues to invest in expanding its product portfolio to appeal to a wider variety of consumers in both new and existing markets,” Sony Ericsson president Dick Komiyama said in a statement.
“Our product announcements during the first quarter have been well received by the industry, and we expect to see a positive effect from these announcements during the second half of 2008,” he said.
For the past year Sony Ericsson has tried to widen its product portfolio and increase its presence on new markets in order to reduce its dependence on its traditional market, Europe.
The company hopes its strategy will propel it into the top trio of mobile phone makers by 2011.
Sony Ericsson, which is not listed on the stock exchange, is a joint venture between Japanese electronics giant Sony and Ericsson of Sweden.