Ericsson, the Swedish multinational networking and telecommunications company, reported a 1.4% increase in net sales to 72.9 billion Swedish kronor in the fourth quarter of 2024. This exceeded the Factset analyst consensus of 72.9 billion kronor. The organic sales growth was 2%, a significant improvement from the previous year’s -17%.
One of the most striking improvements was seen in the adjusted gross margin, which reached 46.3%, surpassing the expected 45.4%. This increase in profitability was also reflected in the EBITA result, which amounted to 8.6 billion kronor, with an EBITA margin of 11.8%. The adjusted EBITA result was even more impressive at 10.2 billion kronor, exceeding expectations, with a margin of 14.0%.
The operating profit for Ericsson in the fourth quarter was 8 billion kronor, with an operating margin of 11.0%. The adjusted operating profit reached 9.6 billion kronor, surpassing both the previous year’s figure and the expected result, with a margin of 13.2%. These financial indicators showcase the company’s strong performance and strategic planning under the leadership of CEO Börje Ekholm.
In his statement on the financial results, Ekholm highlighted the company’s progress in implementing its strategic plan, generating a robust free cash flow, and expanding its presence in programmable networks for enhanced performance. The recent agreement with MásOrange in Europe to develop open programmable networks signifies Ericsson’s commitment to innovation and growth in the telecommunications sector.
A notable achievement for Ericsson was the significant sales growth of 54% in North America during the fourth quarter, demonstrating the company’s strong position in the region. While other market areas experienced a decline, the overall outlook for Ericsson remains positive, especially with the stabilizing RAN market and the continued growth potential in programmable networks.
Looking ahead to 2025, Ekholm outlined the company’s strategic priorities, emphasizing the importance of maintaining leadership in product performance and energy efficiency within the Networks division. Additionally, the focus on stabilizing commercial results in the Enterprise segment and driving growth in critical areas such as private networks reflects Ericsson’s commitment to driving digital transformation in businesses and society.
The impressive growth in net cash to 37.8 billion kronor at the end of the year further solidifies Ericsson’s financial position and provides a strong foundation for future investments and expansion. With a clear roadmap for continued success and innovation, Ericsson is well-positioned to capitalize on emerging opportunities in the telecommunications industry and drive sustainable growth in the years to come.