STOCKHOLM, May 5, 2025 /PRNewswire/ -- In accordance with the resolutions by the Annual General Meeting 2025, Ericsson (NASDAQ: ERIC) expands its treasury stock in order to provide shares for the Long-Term Variable Compensation Programs LTV 2025 and LTV 2024 for Ericsson's executive team and other executives.The Board of Directors of Ericsson has today resolved, by virtue of authorizations given by the Annual General Meeting on March 25, 2025 (the "AGM 2025"), to direct an acquisition offer to all holders o ...

Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even ...

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]

"As early adopters of RCS, Smobi is redefining the way E-commerce brands interact with their customers," said Kunal Puri, Founder of Smobi. "This is only the beginning of RCS's potential as a game-changing communication channel. We're excited to see how this partnership with Vonage raises the benchmark for customer engagement in the industry." Juniper Research ranked Vonage as one of the top leaders in RCS business messaging in 2024. This recognition underscores the strength and scalability of Vonage's Comm ...

About Vonage With global coverage in over 200 countries and territories and its deep integration with Ericsson's expansive telecommunications ecosystem, Vonage continues to empower businesses worldwide and across industries with communications solutions that redefine customer and employee engagement. With the addition of Vonage Network APIs – designed to simplify network complexities with flexibility, accessibility and security – developers, enterprises and network operators can spur innovation of digital t ...

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]