Core Viewpoint - Ericsson is expanding its treasury stock to provide shares for its Long-Term Variable Compensation Programs LTV 2025 and LTV 2024 for its executive team and other executives [1] Group 1: Acquisition Offer - The Board of Directors of Ericsson has resolved to make an acquisition offer to all holders of C shares, which will be conducted from May 5 to May 19, 2025, at approximately SEK 5 per share [2] - This acquisition is part of the financing for the Long-Term Variable Compensation Programs LTV 2025 and LTV 2024, involving all 23.1 million C shares that were resolved to be issued to Skandinaviska Enskilda Banken AB (SEB) [3] Group 2: Share Conversion - Once the acquisition of the 23.1 million C shares is completed, the Board intends to convert them into B shares, resulting in a total of 3,371,351,735 shares in Ericsson, including 261,755,983 A shares and 3,109,595,752 B shares [4]

Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher, with the expectation that established trends will continue [1] Company Overview: Ericsson (ERIC) - Ericsson currently holds a Momentum Style Score of A, indicating strong momentum characteristics [2] - The company has a Zacks Rank of 2 (Buy), suggesting a favorable outlook based on historical performance metrics [3] Performance Metrics - Over the past week, Ericsson's shares increased by 0.24%, while the Zacks Wireless Equipment industry rose by 2.37% [5] - In a longer timeframe, Ericsson's shares have appreciated by 10.03% monthly, outperforming the industry's 3.15% [5] - Over the last quarter, Ericsson's shares have risen by 9.01%, and they have surged by 59.81% over the past year, compared to the S&P 500's -6.91% and 13.12% respectively [6] Trading Volume - The average 20-day trading volume for Ericsson is 30,996,288 shares, which serves as a bullish indicator when combined with rising stock prices [7] Earnings Outlook - In the past two months, three earnings estimates for Ericsson have been revised upwards, increasing the consensus estimate from $0.48 to $0.57 [9] - For the next fiscal year, three estimates have moved higher, while one has been revised downwards [9] Conclusion - Given the strong performance metrics and positive earnings outlook, Ericsson is positioned as a 2 (Buy) stock with a Momentum Score of A, making it a potential candidate for investors seeking short-term gains [11]

Industry Overview - The Zacks Wireless Equipment industry is experiencing strong demand due to rapid 5G deployment and upgrades to cloud and fiber network infrastructure [1][4] - The industry includes companies providing networking solutions, wireless telecom products, and related services for voice and data communications [3] Growth Drivers - The proliferation of IoT, fiber densification, and the shift to cloud services are expected to drive growth for companies like Ericsson, Ubiquiti, and InterDigital [2] - Continuous network tuning and optimization create demand for advanced wireless products and services, with fiber optic networks supporting 4G LTE and 5G standards [4] Challenges - Short-term profitability is compromised due to high costs associated with first-generation 5G products, geopolitical tensions, and supply chain disruptions [5] - High customer inventory levels and macroeconomic challenges are additional headwinds for the industry [5] Market Performance - The Zacks Wireless Equipment industry has outperformed the S&P 500 and the broader Zacks Computer and Technology sector, with a growth of 43.2% over the past year compared to 8.2% and 6.3% respectively [10] - The industry carries a Zacks Industry Rank of 54, placing it in the top 22% of over 250 Zacks industries, indicating positive prospects [8] Valuation Metrics - The industry is currently trading at a trailing 12-month EV/EBITDA of 22.56X, higher than the S&P 500's 16.31X and the sector's 15.3X [13] Notable Companies - **Ericsson**: A leading provider of communication networks, focusing on 5G development with a 60% stock gain over the past year and a long-term earnings growth expectation of 2.4% [15] - **Ubiquiti**: Offers a comprehensive portfolio of networking products, with a 44.2% stock gain over the past year and significant upward revisions in earnings estimates [16] - **InterDigital**: A pioneer in mobile technologies with a 92.8% stock gain over the past year and a long-term earnings growth expectation of 15% [19]

Core Insights - Vonage has partnered with Smobi, an AI-powered RCS platform for E-commerce, to enhance customer communication through Rich Communication Services (RCS) [1][2] - The integration of RCS is expected to improve customer trust, click-through rates (CTR), and conversion rates for Smobi's clients [1][2] - Smobi offers manual RCS campaign capabilities and an AI agent named Mo, which engages customers and drives conversions through personalized interactions [2] Company Developments - Smobi is recognized as a leading RCS platform, aiming to redefine customer interactions for E-commerce brands [2][3] - Vonage is acknowledged as a top leader in RCS business messaging by Juniper Research, highlighting its strong and scalable Communications APIs [4] - The partnership with Smobi exemplifies Vonage's commitment to RCS innovation and enhancing meaningful customer connections [3][4] Industry Trends - Juniper Research predicts significant growth for RCS business messaging in 2025, particularly in North America, driven by an increase in RCS-capable subscribers [3] - The adoption of RCS presents a high-value opportunity for enterprises to enhance their branded communications [3]

Core Insights - Vonage has been recognized as a Leader in the IDC MarketScape: Worldwide Communications Platform as a Service (CPaaS) 2025 Vendor Assessment for the fourth time, highlighting its commitment to innovation and customer-centric solutions [1][2][3] Company Overview - Vonage is a global leader in cloud communications, helping businesses accelerate their digital transformation with a comprehensive set of engagement solutions [6][8] - The company offers a diverse CPaaS platform with a geographically balanced client base across the Americas, Europe, and Asia/Pacific regions [2] Product and Service Offerings - Vonage provides a unified API platform that includes identity, messaging, voice, video, and network APIs, enabling developers to embed these capabilities into existing products and workflows [2][7] - The introduction of Vonage Network APIs aims to simplify network complexities while enhancing flexibility, accessibility, and security for developers and enterprises [2][3] Market Position and Strategy - The recognition from IDC reflects Vonage's mission to enable businesses to create meaningful customer experiences and differentiate their brands through scalable, AI-enhanced solutions [3] - With global coverage in over 200 countries and territories, Vonage leverages its integration with Ericsson's telecommunications ecosystem to empower businesses across various industries [2][3]

Core Viewpoint - Investors are increasingly seeking growth stocks, particularly in the financial sector, to achieve above-average returns, but identifying such stocks can be challenging due to inherent volatility and risks [1] Group 1: Growth Stock Identification - The Zacks Growth Style Score system aids in identifying promising growth stocks by analyzing real growth prospects beyond traditional metrics [2] - Ericsson (ERIC) is currently highlighted as a recommended growth stock, possessing a favorable Growth Score and a top Zacks Rank [2] Group 2: Earnings Growth - Earnings growth is a critical factor for growth investors, with double-digit growth being particularly attractive [3] - Ericsson's historical EPS growth rate is 2.3%, but projected EPS growth for this year is 43.7%, significantly surpassing the industry average of 13.6% [4] Group 3: Asset Utilization - The asset utilization ratio, or sales-to-total-assets (S/TA) ratio, is an important metric for assessing a growth stock's efficiency [5] - Ericsson's S/TA ratio is 0.88, indicating that the company generates $0.88 in sales for every dollar in assets, compared to the industry average of 0.55 [5] Group 4: Sales Growth - Sales growth is another key indicator, with Ericsson expected to achieve a 6% sales growth this year, outpacing the industry average of 5.6% [6] Group 5: Earnings Estimate Revisions - Trends in earnings estimate revisions are crucial, with positive revisions correlating strongly with stock price movements [7] - The current-year earnings estimates for Ericsson have increased by 7.8% over the past month, indicating a positive trend [7] Group 6: Overall Positioning - Ericsson has achieved a Growth Score of A and a Zacks Rank of 2 due to positive earnings estimate revisions, positioning it well for potential outperformance [9]

Core Viewpoint - Ericsson (ERIC) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the consensus measure of EPS estimates from sell-side analysts, reflecting the company's changing earnings picture [1][2]. - Changes in earnings estimates are strongly correlated with near-term stock price movements, largely due to institutional investors adjusting their valuations based on these estimates [4]. Implications of the Upgrade - The upgrade for Ericsson suggests an improvement in the company's underlying business, which could lead to increased buying pressure and a rise in stock price [5][10]. - The Zacks Rank system effectively utilizes earnings estimate revisions to classify stocks, with a strong historical performance of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7]. Specific Earnings Estimates for Ericsson - For the fiscal year ending December 2025, Ericsson is expected to earn $0.52 per share, representing a year-over-year increase of 44.4% [8]. - Over the past three months, the Zacks Consensus Estimate for Ericsson has increased by 4%, indicating a positive trend in earnings expectations [8]. Zacks Rating System Overview - The Zacks rating system maintains a balanced distribution of 'buy' and 'sell' ratings across its universe of over 4000 stocks, with only the top 20% receiving a 'Strong Buy' or 'Buy' rating [9][10]. - The upgrade to Zacks Rank 2 places Ericsson in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

One stock that might be an intriguing choice for investors right now is Ericsson (ERIC) . This is because this security in the Wireless Equipment space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.This is important because, often times, a rising tide will lift all boats in an industry, as there can be broad trends taking place in a segment that are boosting securities across the board. This is arguably taking place in the Wireless Equipm ...

[First Quarter 2025 Report](index=2&type=section&id=First%20quarter%20report%202025) [Financial and Strategic Highlights](index=2&type=section&id=Financial%20and%20Strategic%20Highlights) Ericsson demonstrated solid Q1 2025 performance with strong adjusted gross and EBITA margins, driven by operational execution and strategic technology advancements Q1 2025 Financial Highlights (SEK billion) | | Q1 | Q1 | YoY | Q4 | QoQ | | :--- | :--- | :--- | :--- | :--- | :--- | | **Net sales** | 55.0 | 53.3 | 3% | 72.9 | -25% | | **Organic sales growth*** | - | - | 0% | - | - | | **Gross margin** | 48.2% | 42.5% | - | 44.9% | - | | **Adjusted gross margin** | **48.5%** | 42.7% | - | 46.3% | - | | **EBIT** | 5.9 | 4.1 | 45% | 8.0 | -25% | | **EBIT margin** | 10.8% | 7.7% | - | 10.9% | - | | **Adjusted EBITA** | 6.9 | 5.1 | 36% | 10.2 | -32% | | **Adjusted EBITA margin** | **12.6%** | 9.6% | - | 14.1% | - | | **Net income** | 4.2 | 2.6 | 61% | 4.9 | -14% | | **EPS diluted, SEK** | 1.24 | 0.77 | 61% | 1.44 | -14% | | **Free cash flow before M&A** | 2.7 | 3.7 | -26% | 15.8 | -83% | | **Net cash, end of period** | 38.6 | 10.8 | 258% | 37.8 | 2% | - CEO Börje Ekholm highlighted solid execution, a strong **48.5%** adjusted gross margin, and a **12.6%** adjusted EBITA margin in Q1[4](index=4&type=chunk) - Strategic advancements include extending technology leadership with a portfolio of **130** programmable network radios and announcing the first Asia Pacific programmable network with Telstra[5](index=5&type=chunk)[9](index=9&type=chunk) - The company announced network API fraud detection deployment with all three major US operators[9](index=9&type=chunk) [Group Financial Performance](index=3&type=section&id=Group%20results) [Group Results](index=3&type=section&id=Group%20results) The Group reported a 3% year-over-year net sales increase to SEK 55.0 billion in Q1 2025, with significant gross margin expansion and strong EBIT and net income growth Q1 2025 Group Income Statement (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | | :--- | :--- | :--- | :--- | | **Net sales** | 55.0 | 53.3 | 3% | | **Gross income** | 26.5 | 22.7 | 17% | | **Gross margin** | 48.2% | 42.5% | - | | **R&D expenses** | -12.0 | -11.6 | - | | **SG&A expenses** | -8.6 | -8.7 | - | | **EBIT** | 5.9 | 4.1 | 45% | | **EBIT margin** | 10.8% | 7.7% | - | | **Net income** | 4.2 | 2.6 | 61% | - Reported sales increased by **3%** to **SEK 55.0 billion**, while organic sales were stable. Networks sales grew **6%**, Cloud Software and Services were stable, and Enterprise sales declined **1%**[13](index=13&type=chunk)[14](index=14&type=chunk) - Gross margin improved to **48.2%** (from **42.5%**) primarily due to better margins in Networks from product/market mix and supply chain efficiency, as well as improvements in Enterprise and Cloud Software & Services[16](index=16&type=chunk) - Other operating income was **SEK 0.0 billion**, compared to **SEK 2.0 billion** in Q1 2024 which included a one-time gain of **SEK 1.9 billion**[21](index=21&type=chunk) - The number of employees decreased to **92,866** from **94,236** at the end of the previous quarter[29](index=29&type=chunk) [Market Area Performance](index=5&type=section&id=Market%20area%20sales) [Market Area Sales](index=5&type=section&id=Market%20area%20sales) Q1 2025 sales varied by region, with strong 20% organic growth in Americas offsetting declines in Europe, Middle East, Africa, and Asia due to moderating investments and headwinds Q1 2025 Sales by Market Area (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | YoY organic growth | | :--- | :--- | :--- | :--- | :--- | | **Americas** | 20.8 | 16.4 | 26% | 20% | | **Europe, Middle East and Africa** | 14.5 | 15.3 | -5% | -7% | | **South East Asia, Oceania and India** | 7.2 | 8.6 | -16% | -17% | | **North East Asia** | 3.2 | 3.4 | -6% | -8% | | **Other** | 9.3 | 9.6 | -3% | -6% | | **Total** | **55.0** | **53.3** | **3%** | **0%** | - Americas: Sales grew **20%*** YoY, driven by strong growth in North America from contract wins and accelerated investments, partly offset by lower sales in Latin America[32](index=32&type=chunk)[33](index=33&type=chunk) - Europe, Middle East and Africa: Sales declined **7%*** YoY. Europe was stable, but sales fell in the Middle East due to moderating 5G build-outs and in Africa due to macroeconomic headwinds[35](index=35&type=chunk) - South East Asia, Oceania and India: Sales decreased **17%*** YoY, primarily due to normalized operator investment levels in India compared to the high levels in Q1 2024[36](index=36&type=chunk) [Segment Performance](index=6&type=section&id=Segment%20results) In Q1 2025, Networks drove profitability with strong adjusted EBITA growth, Cloud Software and Services returned to profit, and Enterprise narrowed its loss by focusing on profitable areas [Mobile Networks – Segment Networks](index=6&type=section&id=Mobile%20Networks%20%E2%80%93%20Segment%20Networks) The Networks segment delivered strong Q1 2025 performance with 3% organic sales growth, significant adjusted gross margin expansion to 51.0%, and a 75% surge in adjusted EBITA Q1 2025 Networks Segment Financials (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | | :--- | :--- | :--- | :--- | | **Net sales** | 35.6 | 33.7 | 6% | | **Organic sales growth** | - | - | 3% | | **Adjusted gross margin** | 51.0% | 44.3% | - | | **Adjusted EBITA** | 7.5 | 4.3 | 75% | | **Adjusted EBITA margin** | 21.0% | 12.7% | - | - Sales growth was driven by market area Americas, offsetting declines in other regions, particularly India, which had strong sales in Q1 2024[43](index=43&type=chunk)[44](index=44&type=chunk) - The increase in adjusted gross margin to **51.0%** was attributed to product and market mix, supply chain efficiency, and prior cost-reduction actions[45](index=45&type=chunk) [Cloud Software and Services](index=6&type=section&id=Mobile%20Networks%20%E2%80%93%20Segment%20Cloud%20Software%20and%20Services) Cloud Software and Services experienced a 3% organic sales decline in Q1 2025 but significantly improved profitability, achieving an adjusted EBITA of SEK 0.2 billion Q1 2025 Cloud Software and Services Segment Financials (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | | :--- | :--- | :--- | :--- | | **Net sales** | 13.0 | 13.0 | -1% | | **Organic sales growth** | - | - | -3% | | **Adjusted gross margin** | 39.9% | 37.4% | - | | **Adjusted EBITA (loss)** | 0.2 | -0.3 | - | | **Adjusted EBITA margin** | 1.2% | -2.3% | - | - Sales performance was mixed geographically, with strong project deliveries in India being offset by lower sales in other market areas[48](index=48&type=chunk) - Profitability improvement was driven by higher gross income and lower operating expenses resulting from previous cost-reduction actions[50](index=50&type=chunk) [Enterprise](index=7&type=section&id=Enterprise%20%E2%80%93%20Segment%20Enterprise) The Enterprise segment saw a 7% organic sales decline in Q1 2025, but improved its adjusted gross margin to 56.2% and narrowed its EBITA loss to SEK -0.5 billion Q1 2025 Enterprise Segment Financials (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | | :--- | :--- | :--- | :--- | | **Net sales** | 5.9 | 6.0 | -1% | | **Organic sales growth** | - | - | -7% | | **Adjusted gross margin** | 56.2% | 48.1% | - | | **Adjusted EBITA (loss)** | -0.5 | -0.8 | - | | **Adjusted EBITA margin** | -8.9% | -13.1% | - | - Global Communications Platform (Vonage) sales declined **9%** YoY due to a strategic focus on more profitable segments and reduced activities in some countries[53](index=53&type=chunk) - Enterprise Wireless Solutions sales grew by **20%** YoY, driven by higher subscription and product sales in WWAN and growth in Private 5G[52](index=52&type=chunk) [Segment Other](index=7&type=section&id=Segment%20Other) The 'Other' segment's sales declined to SEK 0.5 billion in Q1 2025 due to divestment, resulting in an adjusted EBITA loss of SEK -0.2 billion compared to a prior-year gain Q1 2025 Other Segment Financials (SEK billion) | | Q1 2025 | Q1 2024 | YoY change | | :--- | :--- | :--- | :--- | | **Net sales** | 0.5 | 0.6 | -20% | | **Adjusted EBITA (loss)** | -0.2 | 1.9 | - | | **Adjusted EBITA margin** | -34.6% | 319.5% | - | - The sales decline reflects the divestment of the IoT business[57](index=57&type=chunk) - The significant YoY decrease in EBITA is due to a one-time gain of **SEK 1.9 billion** in Q1 2024 that was not repeated[59](index=59&type=chunk) [Cash Flow and Financial Position](index=8&type=section&id=Cash%20flow%20and%20financial%20position) [Cash Flow and Financial Position](index=8&type=section&id=Cash%20flow%20and%20financial%20position) Ericsson generated SEK 2.7 billion in free cash flow before M&A in Q1 2025, maintaining a strong financial position with net cash increasing to SEK 38.6 billion Q1 2025 Cash Flow and Financial Position (SEK billion) | | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Cash flow from operating activities** | 4.4 | 5.1 | | **Free cash flow before M&A** | 2.7 | 3.7 | | **Gross cash (end of period)** | 74.2 | 52.0 | | **Net cash (end of period)** | 38.6 | 10.8 | - Cash flow from operating activities was **SEK 4.4 billion**. The benefit from higher earnings was offset by an increase in operating net assets[62](index=62&type=chunk) - Net cash increased sequentially to **SEK 38.6 billion**, while gross cash decreased slightly to **SEK 74.2 billion** due to negative currency effects[64](index=64&type=chunk)[65](index=65&type=chunk) [Outlook and Key Data Points](index=9&type=section&id=Key%20data%20points) [Outlook and Key Data Points](index=9&type=section&id=Key%20data%20points) Ericsson anticipates Q2 2025 uncertainty due to tariffs and macro volatility, with Networks and Cloud Software and Services sales growth aligning with seasonal averages and elevated restructuring charges - The global RAN equipment market is estimated to remain stable in **2025**, according to Dell'Oro[67](index=67&type=chunk) - **Networks Outlook (Q2 2025):** - Sales growth expected to be similar to 3-year average seasonality (+8%) - Adjusted gross margin is expected to be in the range of **48%** to **50%**, which includes an estimated negative impact from tariffs of about **1 percentage point**[69](index=69&type=chunk)[74](index=74&type=chunk) - **Cloud Software and Services Outlook (Q2 2025):** - Sales growth is expected to be broadly similar to the 3-year average seasonality (+15%)[69](index=69&type=chunk)[75](index=75&type=chunk) - Restructuring charges for **2025** are expected to remain at elevated levels[72](index=72&type=chunk) [Parent Company](index=10&type=section&id=Parent%20Company) [Parent Company Financials](index=10&type=section&id=Parent%20Company%20Financials) The Parent Company reported Q1 2025 income after financial items of SEK 0.3 billion, with gross cash at SEK 61.2 billion and a SEK 2.85 per share dividend approved for 2024 - Income after financial items for Q1 2025 was **SEK 0.3 billion**, compared to **SEK 2.6 billion** in Q1 2024[76](index=76&type=chunk) - Gross cash at the end of the quarter amounted to **SEK 61.2 billion**[76](index=76&type=chunk) - A dividend of **SEK 2.85** per share for 2024 was approved, with the first installment of **SEK 1.43** paid on April 1, 2025, and the second of **SEK 1.42** scheduled for October 2, 2025[77](index=77&type=chunk) [Other Information](index=11&type=section&id=Other%20information) [Legal Proceedings and Other Disclosures](index=11&type=section&id=Legal%20Proceedings%20and%20Other%20Disclosures) Ericsson continues cooperation with the DOJ on Iraq investigation and faces various legal proceedings, including patent licensing disputes and civil lawsuits, while also reaching a partial IPR settlement with Lenovo - The company continues to cooperate with the DOJ's investigation into its past conduct in Iraq and other jurisdictions[79](index=79&type=chunk)[80](index=80&type=chunk) - Ericsson is facing patent licensing investigations by competition authorities in India and China[81](index=81&type=chunk)[82](index=82&type=chunk) - Multiple civil lawsuits have been filed in the US under the Anti-Terrorism Act, and in Sweden by shareholders alleging inadequate disclosure regarding the 2019 Iraq investigation[83](index=83&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk) - On April 3, 2025, Ericsson reached a partial settlement and global patent license agreement with Lenovo, with the outstanding dispute to be submitted to arbitration[87](index=87&type=chunk) [Risk Factors](index=13&type=section&id=Risk%20factors) [Risk Factors](index=13&type=section&id=Risk%20factors) Ericsson manages various risks, including technology, IPR, compliance, geopolitical uncertainty, M&A, and cybersecurity, as detailed in its 2024 Annual Report and Form 20-F - The company's risk management is integrated into strategy and operational processes, addressing both short-term and long-term risks[91](index=91&type=chunk) - Risk categories include technology, IPR, compliance, project execution, operations, geopolitical environment, M&A, and cybersecurity[91](index=91&type=chunk) [Financial Statements and Other Information](index=16&type=section&id=Financial%20statements%20and%20other%20information) This section presents unaudited Q1 2025 financial statements, including income, balance sheet, and cash flow, along with accounting policies, segment notes, and detailed reconciliations of Alternative Performance Measures [Financial Statements (Unaudited)](index=16&type=section&id=Financial%20statements%20%28unaudited%29) This section presents the unaudited Q1 2025 condensed consolidated financial statements, including the income statement, balance sheet, and cash flow statement Condensed Consolidated Income Statement (SEK million) | | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net sales** | 55,025 | 53,325 | | **Gross income** | 26,537 | 22,658 | | **EBIT** | 5,931 | 4,100 | | **Net income** | 4,217 | 2,613 | Condensed Consolidated Balance Sheet (SEK million) | | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total assets** | 277,978 | 292,374 | | **Total equity** | 84,858 | 92,983 | | **Total liabilities** | 193,120 | 199,391 | [Accounting Policies and Explanatory Notes](index=24&type=section&id=Accounting%20policies%20and%20Explanatory%20notes%20%28unaudited%29) This section details accounting policies consistent with the 2024 annual report, including the new Q1 2025 market area structure and breakdowns of segment sales, financial instruments, and liabilities - Effective **Q1 2025**, the company implemented a new market area structure, creating 'Market Area Americas' and 'Market Area Europe, Middle East and Africa'. Prior periods have been restated[114](index=114&type=chunk) Top 5 Countries by Sales (Q1 2025) | Country | Percentage of Net Sales | | :--- | :--- | | United States | 45% | | India | 7% | | United Kingdom | 4% | | Japan | 3% | | China | 3% | - As of March 31, 2025, the company reported contingent liabilities of **SEK 3.1 billion** and assets pledged as collateral of **SEK 9.5 billion**[132](index=132&type=chunk) [Alternative Performance Measures (APMs)](index=34&type=section&id=Alternative%20performance%20measures%20%28unaudited%29) This section defines and reconciles non-IFRS Alternative Performance Measures (APMs) used for performance evaluation, including organic sales growth, adjusted EBITA, and free cash flow, with updated definitions for several APMs in Q1 2025 - APMs are used to enhance evaluation of ongoing operations, aid forecasting, and facilitate comparison between periods[138](index=138&type=chunk)[139](index=139&type=chunk) Reconciliation of EBIT to Adjusted EBITA (Q1 2025, SEK million) | | Q1 2025 | | :--- | :--- | | **EBIT (loss)** | 5,931 | | **Total restructuring charges** | 281 | | **Adjusted EBIT (loss)** | 6,212 | | **Amortizations and write-downs of acquired intangibles** | 721 | | **Adjusted EBITA** | **6,933** | Free Cash Flow Before M&A (Q1 2025, SEK million) | | Q1 2025 | | :--- | :--- | | **Cash flow from operating activities** | 4,358 | | **Net capex and other investments (excl. M&A)** | -1,061 | | **Repayment of lease liabilities** | -593 | | **Free cash flow before M&A** | **2,704** |

Group 1 - Kepler Cheuvreux upgraded Ericsson's rating from "Reduce" to "Hold" [1]