Ericsson Announces Fourth Quarter and Full Year 2022 Results, Comment by CEO Ekholm

“Our fourth quarter results put us on track to achieve our long-term EBITA target of 15-18% by 2024. We remain fully committed to our strategic ambitions and have full confidence in the long-term perspective. During the quarter, we made measurable progress towards achieving these ambitions against a backdrop of broad macroeconomic headwinds. As we said during our Capital Markets Day, there are near-term uncertainties, but we are still in the early stages of global 5G rollout and widespread enterprise digitization,” he said Borje EkholmPresident and CEO of ericsson.
Our strategy remains based on driving sustainable growth and maximizing the value of all stakeholders. We are confident that we have the right team and the right strategy to extend our leadership in mobile networks. achieve profitability in cloud software and services; Executed in our high-growth Enterprise segment; Shape the industry landscape by becoming a platform company leveraging the 5G innovation platform; and continue our unwavering commitment to a culture of integrity.
During this quarter, the company signed a multi-year IPR patent license agreement with a major licensee. This positive result positions the company to secure further 5G patent license agreements between handset manufacturers and in new areas such as consumer electronics and IoT. The company expects significant revenue growth in IPR over the next 18 to 24 months. Group net sales grew 1% year-on-year, with IPR sales contributing 5 percentage points. An EBITA of SEK 9.3 (12.8) corresponds to a margin of 10.8% (17.9%).
Indian market
Referring to India, he said: “Our network business grew in India due to significant market share gains. As expected, growth from market share gains in several markets could not fully offset lower operator investment and inventory reductions in other markets, including North America. Gross margin was 44.6% (46.4%), negatively impacted by this shift in business mix, including a higher proportion of service sales from large network rollout projects. The IPR patent license agreement had a positive impact on the margin.”
“During the quarter, we were able to largely offset the impact of high inflation through commercial activity, including product substitution. We continue to invest in technology to improve performance and cost leadership, expand our global footprint and improve productivity and capital efficiency across the supply chain,” he added.
“Our corporate strategy is supported by two pillars: First, our Enterprise Wireless Solutions business, which is focused on capitalizing on the multi-billion dollar market opportunity for 5G-optimized networking and security solutions for enterprises. Second, through the Global Communication Platform business, we will enable new ways to monetize 5G by transforming the way network features such as speed and latency are made available, consumed and paid for around the world. Enterprise is a growth engine for the company and we are continually optimizing our portfolio to maximize profitability. To that end, we announced the divestment of our loss-making IoT business in the fourth quarter,” he added.
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