STOCKHOLM, Oct. 15, 2024 /PRNewswire/ --

Strategic highlights - solid progress on both strategic and operational priorities

Increased momentum in programmable networks, mobile network contract wins in multiple markets.
Global supply of Network APIs secured with JV agreed between leading mobile network operators and Ericsson.
Further 5G patent licensing agreement signed in Q3, IPR revenues expected to reach at least SEK 13 b. in 2024.

Financial highlights - strong growth in North America and continued gross margin expansion

Sales declined by -1%* YoY, with strong growth in market area North America of 55%* offset by declines in most other market areas. Reported sales were SEK 61.8 (64.5) b.
Adjusted[1] gross income increased to SEK 28.6 (25.3) b. driven by a strong expansion in Networks adjusted[1] gross margin to 48.7% (39.9%). Reported gross income was SEK 28.2 (24.7) b.
Adjusted[1] gross margin was 46.3% (39.2%) mainly due to market mix, commercial discipline, and cost actions. A customer settlement and increased IPR revenues also contributed. Reported gross margin was 45.6% (38.4%).
Adjusted[1] EBITA was SEK 7.8 (4.7) b. with a 12.6% (7.3%) margin, benefiting from higher gross income and cost reduction actions, partly offset by targeted investments in R&D. EBITA was SEK 6.2 (3.8) b.
Net income was SEK 3.9 (-30.5) b. EPS diluted was SEK 1.14 (-9.21).
Free cash flow before M&A was SEK 12.9 (-0.5) b. benefiting from strong inventory management and market mix.

Börje Ekholm, President and CEO, said: "Q3 marks a period of laser-focus on execution of our strategic plan. We see increasing customer momentum around programmable networks that deliver differentiated performance, and expect further traction, supported by the JV we have announced with 12 of the world's largest telecom operators. The JV will aggregate network APIs, accelerating commercialization and generating new opportunities for network monetization.

We see signs that the overall market is stabilizing with North America, as an early adopter market, returning to growth. While the market development is ultimately in the hands of our customers, we are working to deliver operational excellence regardless of market conditions. Our Q3 results demonstrate our progress, with strong gross margin expansion and free cash flow, benefiting from our commercial discipline and operational efficiency actions.

We expect our Networks sales to stabilize year-on-year during Q4, driven by continued good growth in North America. However, we anticipate further near-term sales pressure in Enterprise as we focus on profitable segments. We launched a new private 5G enterprise product portfolio in Q3 to support performance improvement, which remains a key priority."


     SEK b.                                                                                                                        Q3            Q3            YoY                Q2   QoQ        Jan-Sep    Jan-Sep     YoY

                                                                                                                                  2024           2023              Change          2024     Change       2024        2023       change



     Net sales                                                                                                                 61.794         64.473                -4 %        59.848        3 %    174.967     191.470         -9 %



      Organic sales growth[2]                                                                                                       -                             -1 %                                                      -7 %



     Gross margin[2]                                                                                                           45.6 %        38.4 %                           43.1 %               43.8 %     38.1 %



     EBIT (loss)                                                                                                                5.774        -28.908                           -13.519                -3.645     -26.174



     EBIT margin[2]                                                                                                             9.3 %       -44.8 %                          -22.6 %               -2.1 %    -13.7 %



     EBITA[2]                                                                                                                   6.203          3.828                62 %         2.426      156 %     13.522       8.218         65 %



     EBITA margin[2]                                                                                                           10.0 %         5.9 %                            4.1 %                7.7 %      4.3 %



     Net income (loss)                                                                                                          3.881        -30.491                           -10.999                -4.505     -29.513



     EPS diluted, SEK                                                                                                            1.14          -9.21                             -3.34                 -1.43       -8.96



     Free cash flow before M&A[2]                                                                                              12.944         -0.540                             7.595       70 %     24.210     -13.548



     Net cash, end of period[2]                                                                                                25.534          1.610                            13.133       94 %     25.534       1.610





     Adjusted financial measures[2]



     Adjusted gross margin                                                                                                     46.3 %        39.2 %                           43.9 %               44.4 %     39.1 %



     Adjusted EBIT (loss)                                                                                                       7.327        -28.020                           -11.891                -0.259     -21.173



     Adjusted EBIT margin                                                                                                      11.9 %       -43.5 %                          -19.9 %               -0.1 %     11.1 %



     Adjusted EBIT excluding impairments[3]                                                                                                                                                                               38 %

                                                                                                                                 7.327          3.896                88 %         3.229      127 %     14.861      10.743



     Adjusted EBIT margin excluding impairments[3]                                                                             11.9 %         6.0 %                            5.4 %                8.5 %      5.6 %



     Adjusted EBITA                                                                                                             7.756          4.716                64 %          4.05       91 %     16.908      13.219         28 %



     Adjusted EBITA margin                                                                                                     12.6 %         7.3 %                            6.8 %                9.7 %      6.9 %







     * Sales adjusted for the impact of acquisitions and divestments and effects of foreign currency fluctuations.


     [1] Adjusted metrics are adjusted to exclude restructuring charges. This is a change in nomenclature only, compared with previous reports.


     [2] Non-IFRS financial measures are reconciled at the end of this report to the most directly reconcilable line items in the financial statement.


     [3] Excluding the non-cash impairment recorded in the second quarter 2024, relating to the impairment of intangible assets mainly attributed to the Vonage acquisition.

NOTES TO EDITORS

You find the complete report with tables in the attached PDF or on www.ericsson.com/investors

Video webcast for analysts, investors and journalists

President and CEO Börje Ekholm and CFO Lars Sandström will comment on the report and take questions at a live video webcast at 9:00 AM CEST (8:00 AM BST London, 3:00 AM EDT New York).

Join the webcast or please go to www.ericsson.com/investors

To ask a question: Access dial-in information here

The webcast will be available on-demand after the event and can be viewed at www.ericsson.com/investors.

Contact person
Daniel Morris, Head of Investor Relations
Phone: +44 7386657217
E-mail: investor.relations@ericsson.com

Additional contacts
Stella Medlicott, Senior Vice President, Marketing and Corporate Relations
Phone: +46 730 95 65 39
E-mail: media.relations@ericsson.com

Investors
Lena Häggblom, Director, Investor Relations
Phone: +46 72 593 27 78
E-mail: lena.haggblom@ericsson.com

Alan Ganson, Director, Investor Relations
Phone: +46 70 267 27 30
E-mail: alan.ganson@ericsson.com

Media
Ralf Bagner, Head of Media Relations
Phone: +46 76 128 47 89
E-mail: ralf.bagner@ericsson.com

Media relations
Phone: +46 10 719 69 92
E-mail: media.relations@ericsson.com

This is information that Telefonaktiebolaget LM Ericsson is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 07:00 CEST on October 15, 2024.

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/ericsson/r/ericsson-reports-third-quarter-results-2024,c4051124

The following files are available for download:


     
     https://mb.cision.com/Main/15448/4051124/3053628.pdf               Ericsson reports third quarter
                                                                            results 2024



     
     https://mb.cision.com/Public/15448/4051124/b627bb7a0ff7cbb1.xlsx 
     Q3 2024

View original content:https://www.prnewswire.co.uk/news-releases/ericsson-reports-third-quarter-results-2024-302275998.html

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