Carphone Warehouse Sees a Decline in Profits of Mobile Phones

Carphone Warehouse - the largest mobile phone retailer in Europe has revealed that the market for prepay handsets suffered a massive setback, over the Christmas season.

According to the retail giant, the market fell by as much as 40 percent owing to a variety of reasons that include a steady decline in consumer confidence. Another reason is the fact that network providers are reducing subsidies they were prepared to pay.

The steady growth in demand for smartphones and tablet computers helped the retailer significantly to maintain a decent revenue. Carphone Warehouse announced the company will continue to sell these gadgets, even though it pulled out from the joint venture with Best Buy.

"There is probably £40m to £50m of revenue coming out of that prepay segment, which we are not going to directly replace," Roger Taylor, the CEO of Carphone Warehouse stated, the Telegraph reports.

Speaking of how the existing infrastructures would allow the company to sell plenty of additional new generation products such as Kindle, iPad, laptops etc., Taylor added: "We can sell those in a much smaller retailing environment. You do not need a 30,000 square feet box to sell what I think is going to be interesting in consumer electronics retailing going forward."