Swedish telecom equipment maker Ericsson reported a swing to a bigger second-quarter adjusted profit than expected, helped by sales growth in North America https://t.co/ujFnL7Nyzo https://t.co/jJI4WWw918
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Sweden’s Ericsson AB delivered stronger-than-expected second-quarter results, posting a SEK 7.0 billion ($728 million) adjusted operating profit against analyst estimates of about SEK 6.1 billion. Net sales slipped 6% to SEK 56.1 billion, below consensus, but cost reductions and licensing gains lifted the adjusted gross margin to 48%, ahead of forecasts and up four percentage points from a year earlier. Performance was underpinned by higher-margin business in North America and a stabilising European market, which offset a 5.3% decline in global networks revenue and a temporary slowdown in India. The networks division, Ericsson’s largest, achieved a 49.5% gross margin despite softer sales, reflecting continued demand for 5G equipment and disciplined spending. Management said recently imposed U.S. tariffs curbed further margin expansion, adding that the company is balancing production across regions to limit additional cost pressure. For the third quarter, Ericsson projects a networks gross margin of 48%–50% and expects Indian operator investment to recover. Shares in Ericsson fell roughly 3% in early Stockholm trading after the release, trimming year-to-date losses even as the company emphasised its structurally lower cost base and focus on further efficiencies.
