Mobile phone manufacturer Sony Ericsson reported a third quarter running of net profits on Friday following dramatic restructuring after a bad patch last year.

But its sales for the quarter fell far below expectations.

The Japanese-Swedish group, the fifth-biggest player in the global sector, said that in the three months ending in September, it had made a net profit of €49 million, compared to $193 million in the red in the same quarter last year.

The company’s sales, however, slipped by one per cent to €1.60 billion, it said in its earnings statement.

The outcome fell far short of the figures expected by analysts who in a poll by Dow Jones Newswires had forecast a net profit of €67 million on sales up 13 per cent at $1.87 billion.

Sales and the net outcome had plunged in 2009. Last year the company launched a programme to reduce costs involving an extra loss of jobs amounting to nearly 2,000 cuts.

The difficulty for Sony Ericsson, as for Nokia in neighbouring Finland, has been sudden steep competition from Canadian RiM (Blackberry) and especially from American Apple (iPhone), forcing the company to refocus its business on the high end of the handset market.