LONDON — A profit warning from Sony Ericsson sent the share price of most mobile phone makers lower as the joint venture between Sony and Ericsson said second-quarter sales and net income would be hit by slowing demand for mid- to high-end models, and that it would only break even for the quarter.

Sony Ericsson said the market is "challenging" and that it plans to ship approximately 24 million phones during the quarter at an average selling price of Euros 115, well down on previous estimates for both volume and ASP.

During the seasonally slower first quarter, Sony Ericsson shipped 22.3 million phones at an average price of Euros 121.

The news on Friday (June 27) drove shares in co-parent Ericsson down 8.1 percent on the Stockholm exchange.

Analysts were braced for weaker market conditions after a poor first quarter from Sony Ericsson amidst continued signs that consumers are being hit by an international credit crisis, high oil prices and general economic anxiety.

This marks the second successive quarter in which Sony Ericsson has had to warn investors on results. The firm had been riding high in recent years, climbing up the sector rankings and closing in on the No. 3 spot. But it dropped to fifth place in the first quarter, ceding the No. 4 spot to South Korea's LG Electronics.

Nokia, whose shares sank 5.3 percent on the Helsinki exchange, is the clear world leader in mobile phones, followed by Samsung Electronics and Motorola, which has also been suffering from poor sales over the past two quarters.

Sony Ericsson second-quarter results are due on July 18.

Related Articles:

Analysts: Economic jitters could impact cellphone shipments

Sony Ericsson project combines Java, Flash Lite for mobiles

Nokia builds open mobile software foundation