Ericsson Beats Profit Forecasts Despite Margin Pressure
Ericsson reported third-quarter core operating profits of 10.1 billion crowns, exceeding analyst expectations despite a year-over-year decline and rising component costs.
The Swedish telecom gear maker Ericsson reported a third-quarter core operating profit of 10.1 billion crowns ($1.01 billion). While this figure represents a decline from the 15.8 billion crowns earned in the same period last year, it surpassed analyst forecasts of 7.87 billion crowns. The company's adjusted EBITA margin narrowed to 17.0 per cent from 28.1 per cent, though it remained above the predicted 14.2 per cent.
Organic sales grew 7 per cent to 59.5 billion crowns, aided by slight increases in North American sales. Efficiency measures helped the company offset immediate expenses during the quarter.
CEO Per Narvinger warned that gross margins will face headwinds next year due to rising component costs, which are being driven by surging AI demand for memory chips. Narvinger also noted that the Radio Access Network market remains flat while geopolitical uncertainty remains elevated.
