Ericsson, the leading telecom equipment maker, has revealed 7 percent drop in sales revenue to $5.68 billion or SEK 59.8 billion in the second-quarter of 2024 as telecoms start cutting their capital expenditure (Capex).
Ericsson noted reduction in operator investment levels across most geographies. Sales of Ericsson dropped in most of the regions. Ericsson has achieved substantial growth in North America due to lower sales in Q2 2023.
Ericsson has generated sales revenue of SEK 16.6 billion (up 14 percent) in North America, SEK 15.6 billion (down 3 percent) in Europe and Latin America, SEK 7.7 billion (down 44 percent) in South East Asia and India, SEK 4.6 billion (down 3 percent) in North East Asia, SEK 4.9 billion (down 8 percent) in the Middle East and Africa, and SEK 10.4 billion (up 7 percent) from Enterprises and IPR in Q2 2024.
Ericsson’s second-quarter sales revenue has reached SEK 37.679 billion (down 11 percent) from Networks, SEK 15.180 billion (nil growth) from Cloud Software and Services SEK 6.484 billion (up 9 percent) from Enterprise and SEK 505 million (down 15 percent) from Other.
Ericsson has generated 38 percent of its total sales revenue from United States, 6 percent from India, 6 percent from China, 3 percent from United Kingdom and 3 percent from Japan.
Ericsson is aiming to deliver on network technology leadership strategy. Ericsson was recognized as 5G leader in Frost Radar 5G Network Infrastructure Market 2024. Ericsson was also recognized in Gartner Magic Quadrant Critical Capabilities for CSP 5G RAN Network Infrastructure Solutions report.
Ericsson’s Vonage business unit signed two partnerships for Global Network Platform for network APIs. Ericsson has also signed new 5G patent licensing agreement. Ericsson is on track to deliver the SEK 12-13 billion in IPR revenue for 2024.
Borje Ekholm, President and CEO of Ericsson, said: “We maintained our leading market position, returned to growth in North America, and delivered strong gross margin expansion and free cash flow.”
Ericsson stake in Vodafone Idea
In June 2024, Ericsson India entered into an agreement with Indian telecom operator Vodafone Idea (VIL) to settle outstanding accounts receivables, and pick up an equity stake in VIL. The stake of Ericsson in Vodafone Idea will be subject to a six-month lock up period.
The impact of the transaction is expected to be recognized in Ericsson’s Q3 results.
Baburajan Kizhakedath
