Ericsson 1Q Earnings Rise on Continued 5G Traction -- Earnings Review

By Dominic Chopping

STOCKHOLM--Sweden's Ericsson AB reported first-quarter earnings Wednesday. Here's what we watched:

EARNINGS: The telecom-equipment maker posted a net profit of 3.19 billion Swedish kronor ($378.2 million) from SEK2.16 billion a year earlier. This compared with SEK2.87 billion expected in a consensus provided by FactSet.

REVENUE: Sales edged 0.1% higher to SEK49.78 billion against SEK52.66 billion expected.

WHAT WE WATCHED:

5G PROGRESS: Networks sales grew organically by 15%, despite a decline in intellectual property licensing revenues due to ongoing litigation. Ericsson said the growth reflects continued high activity levels in all market areas, except in the Middle East and Africa.

"We continued to grow market share in the quarter with strong order intake," CEO Borje Ekholm said. "There is strong momentum in the global 5G demand with lead markets moving forward at high pace, creating opportunities for us to grow our core business. To that end we continue to invest in further strengthening our portfolio and growing our global footprint."

SUPPLY CHAIN: Ericsson said that with proactive and continuous measures for supply chain resilience, it has to date been able to manage the global semiconductors shortage situation without impact on its customer deliveries.

GUIDANCE: The company expects the overall market to develop favorably during 2021. It said it intends to continue to invest for market share gains as well as supply chain resilience during the rest of the year.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

April 21, 2021 06:49 ET (10:49 GMT)

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