Ericsson beats expectations in third-quarter net profit

245
1
Ericsson beats expectations in third-quarter net profit

STOCKHOLM - Ericsson AB released a third quarter net profit that beat expectations as strong sales of 5 G equipment in North America, Europe and Latin America helped offset a hefty sales decline in mainland China.

The telecommunication equipment company reported second-quarter net profit attributable to shareholders of 5.75 billion kronor $665 million compared with SEK 5.35 billion in the year-earlier period.

Sales slipped 2.1% to SEK 56.26 billion in mainland China following heavy salesfall and some supply-chain disturbances late in the third quarter which would continue to pose a risk, it said. Analysts polled by FactSet had expected net profit of SEK 4.86 billion on sales of SEK 58.3 billion. Ericsson previously warned that Sweden's ban on using certain Chinese gear could see the company faced retaliation and warned that the China sales of switches and digital services fell by SEK 3.6 billion in the year. As a consequence of the reduced share of the market in mainland China we are planning to resize our sales and delivery organisation in the country, starting in 4 Q, adding to our restructuring charges, chief executive Borje Ekholm said. Overall sales of network equipment fell 3% on the year.