Ericsson first quarter report 2012

* Sales decreased -4% YoY, impacted by an expected major decline in CDMA sales as well as lower operator network spending in regions with macro-economic or political uncertainty. Global Services and consolidation of Telcordia contributed positively. * The underlying business mix, with higher share of coverage and network modernization projects than capacity projects, was unchanged. This mix is expected to prevail short-term. * Operating margin 5...

• Sales decreased -4% YoY, impacted by an expected major decline in CDMA sales as well as lower operator network spending in regions with macro-economic or political uncertainty. Global Services and consolidation of Telcordia contributed positively.
• The underlying business mix, with higher share of coverage and network modernization projects than capacity projects, was unchanged. This mix is expected to prevail short-term.
• Operating margin 5.5% excl. gain from Sony Ericsson divestment and loss in ST-Ericsson.
• Net income SEK 8.8 b. up 116% YoY, impacted by gain from Sony Ericsson divestment of SEK 7.7 b and loss in ST-Ericsson.
• EPS diluted SEK 2.76 (1.27), driven by gain from Sony Ericsson divestment. EPS Non-IFRS and excluding Sony Ericsson gain SEK 0.77 (1.61).

 

COMMENTS FROM HANS VESTBERG, PRESIDENT AND CEO

"Sales of high-performance mobile broadband developed well in North America, Japan and Korea, while other regions such as Europe including Russia, parts of Middle East and India were weaker," says Hans Vestberg, President and CEO of Ericsson (NASDAQ:ERIC). "CDMA continued its expected decline in the transition to LTE. Our services business showed continued momentum where especially Professional Services developed favorably. Support Solutions (former Multimedia) increased organic sales.

In the quarter, we took important steps in our strategy execution. The announced acquisition of BelAir adds WiFi capabilities to our hetnet portfolio and by acquiring Technicolor's Broadcast Services Division we have strengthened our position in media and broadcasting services, targeting a leadership position in Europe. With the completed divestment of Sony Ericsson, we have left the consumer part of the handset business in order to focus on enabling connectivity for all devices, handsets and beyond. Last year, we gained market share in our core businesses and continued to build a strong LTE position where we have more than 60% market share.

Late 2010, we took a strategic decision to increase our market share in Europe when operators started to modernize their networks and replacing old infrastructure with new multi-standard radio base stations. This, together with the business mix with more coverage than capacity projects, has, as expected, had a negative impact on gross margin YoY and is expected to prevail short-term.

Our joint venture ST-Ericsson has launched a revised strategy and actions to reduce its break-even point. We remain confident that ST-Ericsson has a strategic position in the industry to enable the device ecosystem," concludes Vestberg.

 

You find the complete report with tables in the attached PDF or by following this link:
www.ericsson.com/res/investors/docs/q-reports/2012/3month12-en.pdf

EDITOR'S NOTE

Ericsson invites media, investors and analysts to a press conference at the Ericsson Studio, Grönlandsgången 4, Stockholm, at 09.00 (CET), April 25, 2012. An analysts, investors and media conference call will begin at 14.00 (CET).

Live webcast of the press conference and conference call as well as supporting slides will be available at www.ericsson.com/press and www.ericsson.com/investors

Video material will be published during the day on www.ericsson.com/broadcast_room

FOR FURTHER INFORMATION, PLEASE CONTACT

Helena Norrman, Senior Vice President, Communications
Phone: +46 10 719 3472
E-mail: [email protected] or [email protected]

INVESTORS

Åse Lindskog, Vice President,
Head of Investor and Analyst Relations
Phone: +46 10 719 9725
+46 730 244 872
E-mail: [email protected]

Stefan Jelvin, Director,
Investor Relations
Phone: +46 10 714 2039
E-mail: [email protected]

Åsa Konnbjer, Director,
Investor Relations
Phone: +46 10 713 3928
E-mail: [email protected]  

Rikard Tunedal, Director,
Investor Relations
Phone: +46 10 714 5400
E-mail: [email protected]

MEDIA

Ola Rembe, Vice President,
Head of Corporate Public & Media Relations
Phone: +46 10 719 9727
+46 730 244 873
E-mail: [email protected]

Corporate Public & Media Relations
Phone: +46 10 719 69 92
E-mail: [email protected]

Telefonaktiebolaget LM Ericsson (publ)
Org. number: 556016-0680
Torshamnsgatan 23
SE-164 83 Stockholm
Phone: +46 10 719 0000
www.ericsson.com  

Ericsson discloses the information provided herein pursuant to the Securities Markets Act. The information was submitted for publication at 07.30 CET, on April 25, 2012.

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