Handset maker Sony Ericsson reported a second quarter loss of €50 million ($70.5 million) on Friday. The earthquake that hit Japan on March 11 was the main reason Sony cited for the company’s, loss as it gravely affected the supply chain.

“Sony Ericsson’s second quarter profitability was affected by the March 11 earthquake in Japan. We estimate that the impact of earthquake-related supply chain constraints on our portfolio was close to 1.5 million units, with most of the effect in the early part of the quarter,” said Bert Nordberg, President and CEO of Sony Ericsson.

Compared to last year of the same quarter, the company earned €12 million ($17 million), and €11 million ($15.5 million) in the last quarter.

Units shipped during the quarter were 7.6 million, a 31% decrease year- on-year and a 6% decrease sequentially, due to a decrease in volume caused by constrained supply of critical components and an anticipated decline in the number of feature phones shipped.

Average selling price (ASP) for the quarter was Euro 156, a 3% decrease year-on- year but an 11% increase sequentially. The year-on-year decrease is due to product and geographic mix and price erosion. The sequential increase in ASP is attributed to favorable product and geographic mix, more than offsetting price erosion and unfavorable foreign exchange rates.

More than 70 percent of Sony Ericsson’s first quarter sales are attributed to smartphones. Nordberg stated that the company shipped more than 16 million Android-powered Xperias to date. Sony Ericsson contributes 11 percent in volume and value of the entire Android market.

Sony Ericsson is still positive in reporting better results for 2011. According to Nordberg, all they need to do is increase their second-half operating profit by 73 percent to 176 million euros to achieve that.

One of Sony Ericsson’s biggest rivals, Nokia, is set to report its earnings next week, which is expected to also have second-quarter losses due to the Finnish company’s slow transition to high-end handsets.  Last month, Nokia unveiled the MeeGo-powered N9 smartphone. They have yet to release their Windows Phone 7-powered handset, which  was leaked by Nokia employees.

On another note: Engadget reported that Sony Ericsson’s Xperia Mini Pro was seen “sliding” through the FCC. The latest smartphone is expected to launch in the third quarter of this year.

image credit: ykanazawa1999