Mobile phone manufacturer Sony Ericsson will switch to making only smartphones during 2012, after sales of its feature phones fell during its fiscal third quarter.
Company chief executive Bert Nordberg revealed the change in focus in Sony Ericsson's quarterly earning report on Friday.
"We will continue to invest in the smartphone market, shifting the entire portfolio to smartphones during 2012," Nordberg said in a statement. "Sales of feature phones declined, particularly in Western Europe."
The company, a joint venture between Sony and Ericsson, made the decision after sales slumped for non-smartphone devices and rose for smartphones. During the three-month period ended 30 September, Xperia smartphones accounted for 80 percent of its total sales, up from 50 percent during the same period in 2010.
Total sales were €1.6bn (£1.4bn) up from €1.2bn in the previous quarter. However, profits were flat, an improvement from the €50m loss in its second quarter but down from €49m profit during the third quarter of 2010.
Despite not being able to predict the next quarter, Nordberg was moderately upbeat about the company's future.
"While the competitive environment is fierce, we believe that our ongoing transition to smartphones will help us to deliver an ambition that we have for long-term profitable growth," he said. "We remain uncertain about the macro-economy and overall consumer confidence going into the fourth quarter."