Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      World Bank set to back South Africa’s big energy grid roll-out

      20 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Sita hits back at critics, promises faster, automated procurement

      20 June 2025

      The transatlantic race to create the first television

      20 June 2025

      Listed: All the MVNOs in South Africa – 2025 edition

      19 June 2025
    • World

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025

      China is behind in AI chips – but for how much longer?

      13 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025

      TCS+ | The future of mobile money, with MTN’s Kagiso Mothibi

      6 June 2025

      TCS+ | AI is more than hype: Workday execs unpack real human impact

      4 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025

      South Africa’s next crisis? Being offline in an AI-driven world

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Top » Tough times hit Ericsson

    Tough times hit Ericsson

    By Agency Staff12 October 2016
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Ericsson CEO Jan Frykhammar
    Ericsson CEO Jan Frykhammar

    Ericsson said earnings missed estimates last quarter amid waning demand for wireless network equipment, a further setback for the Swedish manufacturer struggling to reverse plunging sales and reduce costs.

    Revenue dropped 14% to 51,1bn kronor (US$5,8bn) in the third quarter and the gross margin, or what’s left of sales after production costs, shrank to 28% from 34%, according to an unscheduled statement Wednesday.

    Analysts had predicted sales of 54,2bn kronor and a gross margin of about 33%, the average estimates compiled by Bloomberg.

    “Our result is significantly lower than we expected, with a particularly weak end of the quarter, and deviates from what we previously have communicated regarding market development,” CEO Jan Frykhammar said in the release. “The negative industry trends have further accelerated.”

    The size of the revenue slump underscores Ericsson’s challenges as it tries to keep up with rising competition and slowing demand from phone carriers. As the falling sales began to eat into profit, Ericsson ousted its chief executive officer in July and last week said it plans to cut 3 000 jobs in Sweden, a fifth of the workforce in its home country.

    Operating profit dropped to 0,3bn kronor from 5,1bn kronor, Ericsson said. The company has targeted cost cuts aimed at saving 9bn kronor a year by 2017, with analysts estimating that it needs to announce further job reductions to achieve its goal.

    Ericsson said the sales decline was driven by markets with weak economies, such as Brazil, Russia and the Middle East. Sales in Europe were lower after carriers largely completed network projects in 2015, the company said.

    The company is trying to revive earnings growth through savings as it competes with Huawei and Nokia in an increasingly tough market. Carriers are restraining investments after spending billions of dollars building fourth-generation network systems so users can stream music and video on phones and tablets. Meanwhile, demand for so-called fifth-generation, or 5G, equipment is yet to pick up as the technology isn’t ready yet.

    Shares of Ericsson have lost 25% this year, valuing the company at 206bn kronor. They fell 0,5% to 61,85 kronor in Stockholm on Tuesday.  — (c) 2016 Bloomberg LP



    Ericsson Huawei Jan Frykhammar Nokia
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleSABC board not welcome back here: ANC MP
    Next Article Backspace: ‘Why I like the Springboks’

    Related Posts

    China is behind in AI chips – but for how much longer?

    13 June 2025

    Huawei bets on brains over brawn in AI chip race

    10 June 2025

    The most expensive smartphones in South Africa in 2025

    5 June 2025
    Company News

    Making IT happen: how Trade Link gears up to enable SA retail strategies

    20 June 2025

    Why parents choose CambriLearn for online education

    19 June 2025

    Disrupt first, ask questions later – the uncomfortable truth about incident response

    18 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.