Accessibility Statement Skip Navigation
  • Resources
  • Blog
  • Journalists
  • +44 (0)20 7454 5110
  • Client Login
  • Send a Release
Return to PR Newswire homepage
  • News
  • Products
  • Contact
When typing in this field, a list of search results will appear and be automatically updated as you type.

Searching for your content...

No results found. Please change your search terms and try again.
  • News in Focus
      • Browse News Releases

      • All Public Company News
      • All Multimedia News
      • View All News Releases

      • Regulatory News

      • D/A/CH Regulatory News
      • UK Regulatory News
      • View All Regulatory News

  • Business & Money
      • Auto & Transportation

      • Aerospace & Defense
      • Air Freight
      • Airlines & Aviation
      • Automotive
      • Maritime & Shipbuilding
      • Railroads & Intermodal Transportation
      • Supply Chain/Logistics
      • Transportation, Trucking & Railroad
      • Travel
      • Trucking & Road Transportation
      • View All Auto & Transportation

      • Business Technology

      • Blockchain
      • Broadcast Tech
      • Computer & Electronics
      • Computer Hardware
      • Computer Software
      • Data Analytics
      • Electronic Commerce
      • Electronic Components
      • Electronic Design Automation
      • Financial Technology
      • High Tech Security
      • Internet Technology
      • Nanotechnology
      • Networks
      • Peripherals
      • Semiconductors
      • View All Business Technology

      • Entertain­ment & Media

      • Advertising
      • Art
      • Books
      • Entertainment
      • Film & Motion Picture
      • Magazines
      • Music
      • Publishing & Information Services
      • Radio & Podcast
      • Television
      • View All Entertain­ment & Media

      • Financial Services & Investing

      • Accounting News & Issues
      • Acquisitions, Mergers & Takeovers
      • Banking & Financial Services
      • Bankruptcy
      • Bond & Stock Ratings
      • Conference Call Announcements
      • Contracts
      • Cryptocurrency
      • Dividends
      • Earnings
      • Earnings Forecasts & Projections
      • Financing Agreements
      • Insurance
      • Investments Opinions
      • Joint Ventures
      • Mutual Funds
      • Private Placement
      • Real Estate
      • Restructuring & Recapitalisation
      • Sales Reports
      • Shareholder Activism
      • Shareholder Meetings
      • Stock Offering
      • Stock Split
      • Venture Capital
      • View All Financial Services & Investing

      • General Business

      • Awards
      • Commercial Real Estate
      • Corporate Expansion
      • Earnings
      • Environmental, Social and Governance (ESG)
      • Human Resource & Workforce Management
      • Licensing
      • New Products & Services
      • Obituaries
      • Outsourcing Businesses
      • Overseas Real Estate (non-US)
      • Personnel Announcements
      • Real Estate Transactions
      • Residential Real Estate
      • Small Business Services
      • Socially Responsible Investing
      • Surveys, Polls & Research
      • Trade Show News
      • View All General Business

  • Science & Tech
      • Consumer Technology

      • Artificial Intelligence
      • Blockchain
      • Cloud Computing/Internet of Things
      • Computer Electronics
      • Computer Hardware
      • Computer Software
      • Consumer Electronics
      • Cryptocurrency
      • Data Analytics
      • Electronic Commerce
      • Electronic Gaming
      • Financial Technology
      • Mobile Entertainment
      • Multimedia & Internet
      • Peripherals
      • Social Media
      • STEM (Science, Tech, Engineering, Math)
      • Supply Chain/Logistics
      • Wireless Communications
      • View All Consumer Technology

      • Energy & Natural Resources

      • Alternative Energies
      • Chemical
      • Electrical Utilities
      • Gas
      • General Manufacturing
      • Mining
      • Mining & Metals
      • Oil & Energy
      • Oil & Gas Discoveries
      • Utilities
      • Water Utilities
      • View All Energy & Natural Resources

      • Environ­ment

      • Conservation & Recycling
      • Environmental Issues
      • Environmental Policy
      • Environmental Products & Services
      • Green Technology
      • Natural Disasters
      • View All Environ­ment

      • Heavy Industry & Manufacturing

      • Aerospace & Defence
      • Agriculture
      • Chemical
      • Construction & Building
      • General Manufacturing
      • HVAC (Heating, Ventilation & Air-Conditioning)
      • Machinery
      • Machine Tools, Metalworking & Metallurgy
      • Mining
      • Mining & Metals
      • Paper, Forest Products & Containers
      • Precious Metals
      • Textiles
      • Tobacco
      • View All Heavy Industry & Manufacturing

      • Telecomm­unications

      • Carriers & Services
      • Mobile Entertainment
      • Networks
      • Peripherals
      • Telecommunications Equipment
      • Telecommunications Industry
      • VoIP (Voice over Internet Protocol)
      • Wireless Communications
      • View All Telecomm­unications

  • Lifestyle & Health
      • Consumer Products & Retail

      • Animals & Pets
      • Beers, Wines & Spirits
      • Beverages
      • Bridal Services
      • Cannabis
      • Cosmetics & Personal Care
      • Fashion
      • Food & Beverages
      • Furniture & Furnishings
      • Home Improvement
      • Household, Consumer & Cosmetics
      • Household Products
      • Jewellery
      • Non-Alcoholic Beverages
      • Office Products
      • Organic Food
      • Product Recalls
      • Restaurants
      • Retail
      • Supermarkets
      • Toys
      • View All Consumer Products & Retail

      • Entertain­ment & Media

      • Advertising
      • Art
      • Books
      • Entertainment
      • Film & Motion Picture
      • Magazines
      • Music
      • Publishing & Information Services
      • Radio & Podcast
      • Television
      • View All Entertain­ment & Media

      • Health

      • Biometrics
      • Biotechnology
      • Clinical Trials & Medical Discoveries
      • Dentistry
      • FDA Approval
      • Fitness/Wellness
      • Health Care & Hospitals
      • Health Insurance
      • Infection Control
      • International Medical Approval
      • Medical Equipment
      • Medical Pharmaceuticals
      • Mental Health
      • Pharmaceuticals
      • Supplementary Medicine
      • View All Health

      • Sports

      • General Sports
      • Outdoors, Camping & Hiking
      • Sporting Events
      • Sports Equipment & Accessories
      • View All Sports

      • Travel

      • Amusement Parks & Tourist Attractions
      • Gambling & Casinos
      • Hotels & Resorts
      • Leisure & Tourism
      • Outdoors, Camping & Hiking
      • Passenger Aviation
      • Travel Industry
      • View All Travel

  • Policy & Public Interest
      • Policy & Public Interest

      • Animal Welfare
      • Corporate Social Responsibility
      • Economic News, Trends & Analysis
      • Education
      • Environmental
      • European Government
      • Labour & Union
      • Natural Disasters
      • Not For Profit
      • Public Safety
      • View All Policy & Public Interest

  • People & Culture
      • People & Culture

      • Aboriginal, First Nations & Native American
      • African American
      • Asian American
      • Children
      • Diversity, Equity & Inclusion
      • Hispanic
      • Lesbian, Gay & Bisexual
      • Men's Interest
      • People with Disabilities
      • Religion
      • Senior Citizens
      • Veterans
      • Women
      • View All People & Culture

  • Overview
  • Distribution
  • Paid Placement
  • Multichannel Amplification
  • Disclosure Services
  • SocialBoost
  • Rooms
    • MediaRoom
    • ESG Rooms
  • AI Tools
  • General Enquiries
  • Media Enquiries
  • Partnerships
  • Hamburger menu
  • Cision PR Newswire UK provides press release distribution, targeting, monitoring, and marketing services
  • Send a Release
    • Phone

    • +44 (0)20 7454 5110 from 8 AM - 5:30 PM GMT

    • ALL CONTACT INFO
    • Contact Us

      +44 (0)20 7454 5110
      from 8 AM - 5:30 PM GMT

  • Client Login
  • Send a Release
  • Resources
  • Blog
  • Journalists
  • News in Focus
    • Browse News Releases
    • Regulatory News
  • Business & Money
    • Auto & Transportation
    • Business Technology
    • Entertain­ment & Media
    • Financial Services & Investing
    • General Business
  • Science & Tech
    • Consumer Technology
    • Energy & Natural Resources
    • Environ­ment
    • Heavy Industry & Manufacturing
    • Telecomm­unications
  • Lifestyle & Health
    • Consumer Products & Retail
    • Entertain­ment & Media
    • Health
    • Sports
    • Travel
  • Policy & Public Interest
    • Policy & Public Interest
  • People & Culture
    • People & Culture
  • Client Login
  • Send a Release
  • Resources
  • Blog
  • Journalists
  • Overview
  • Distribution
  • Paid Placement
  • Multichannel Amplification
  • Disclosure Services
  • Cision Communications Cloud®
  • AI Tools
  • Client Login
  • Send a Release
  • Resources
  • Blog
  • Journalists
  • General Enquiries
  • Media Enquiries
  • Partnerships
  • Client Login
  • Send a Release
  • Resources
  • Blog
  • Journalists

Ericsson Capital Markets Day 2017


News provided by

Ericsson

08 Nov, 2017, 13:47 GMT

Share this article

Share toX

Share this article

Share toX

STOCKHOLM, November 8, 2017 /PRNewswire/ --

  • Update on company strategy, progress in strategy execution and planning assumptions going forward
  • Long term target of more than 12% operating margin, excluding restructuring, beyond 2020
  • Robust plans in place with a target of sales of SEK 190 – 200 b. with 37 – 39% gross margin and at least 10% operating margin, excluding restructuring, by 2020 for the Group.

Ericsson (NASDAQ:ERIC) is today holding its Capital Markets Day. The company is giving an overview of its focused business strategy and deep dives in execution in all business segments.

Börje Ekholm, President and CEO, says: "Our job and commitment is to rebuild Ericsson to be successful long-term. Near term we will prioritize profitability over growth. Healthy profitability is the base for long-term success and will give us the freedom and resources to invest for the long term."

The company mission is to enable the full value of connectivity for its service provider customers. In the work to turn around performance, each portfolio area has a clear focus. In Networks, the company is increasing R&D for technology and cost leadership. In Digital Services, focus is on reaching break even by shifting to software-led solutions and adjusting the cost base. In Managed Services, a contract review is ongoing and investments in automation have started. Finally, a structured approach to technology and business innovations will over time drive new growth in Emerging Businesses.

In this first phase of strategy execution, focus is on simplifying and stabilizing the business. A simplified company structure and organization has been put in place. The first results from accelerated cost reduction activities and contract reviews are already visible and there is good traction in the ongoing portfolio review. At the same time, the company is taking steps to invest into future growth as the industry transitions into 5G.

Börje Ekholm, President and CEO, Ericsson says: "5G is not just another G. Even though we are not planning for significant 5G sales before 2020, we are convinced it will create value for our customers in their mobile broadband business, enabling them to manage very high traffic growth. But even more important, it has the potential to create new businesses and revenue streams for service providers based on use cases such as industrial applications. With the combination of products and capabilities that we have in Networks and Digital Services combined, we are well positioned to support our customers' network evolution to 5G."

Group financial targets and profitability

The target for net sales is SEK 190 – 200 b. by 2020.

The focused business strategy presented in March this year, stated the ambition to improve returns to shareholders, including the potential of more than 12 % operating margin on a sustainable basis beyond 2018, excluding restructuring costs.

Ericsson remains fully committed to this ambition but the starting point has become more challenging and therefore it will take some additional time than originally planned for. This is due to a weaker than expected Radio Access Network equipment market that will have significant compound effect over the coming years, FX movements with our reporting currency SEK strengthening against the USD and an even more challenging situation in Digital Services than the original assessment indicated.

However, there are robust plans in place which will take us to a gross margin of 37 – 39% and an operating margin of at least 10% for the Group in 2020, excluding restructuring charges. This target does not factor in any significant 5G sales during this time period.

Börje Ekholm continues: "We have plans in place for all segments that combined sum up to an operating margin of between 10 – 12% by 2020, but since there are execution risks in all plans and we start from a weaker starting point than originally planned for, we prefer to be cautious and commit to the lower end of the range. Beyond 2020, we will drive continued improvements and capture upsides from innovation and emerging business to reach our ambition of at least 12% operating margin for the Group."

2020 targets and planning assumptions

(see below under heading New financial reporting structure for details on new segment structure)

SEK b.


Networks

Digital Services

Managed Services

Other

Total

 

Target 2020

Net sales

128 – 134

42 – 44

20 – 22

3 – 5

190 – 200

 


Operating margin 1)

15 – 17%

Low single digit

4 – 6%

Breakeven

>10%

 








Baseline 2017 Q3 rolling 4Q unaudited and preliminary

Net sales

133 – 135

41 – 43

24 – 26

7 – 9 3)

211


Operating margin  2)

13 – 14%

-15 to -17%

-4 to -6%

-57% to -62%

3)

3%

1) Excluding restructuring charges

2) Numbers are excluding restructuring charges and extraordinary items

3) Including Media Solutions and Broadcast & Media Services

Note: All financial targets are based on USD/SEK at 8.20. USD to SEK movements has a direct impact on reported sales and income. If the USD to SEK weakens by -10% it has approximately 5% negative impact on topline and 1 percentage point on operating margin.

Market development

In line with external analysts' market size estimates, Ericsson expects that the Radio Access Network equipment market addressed by segment Networks will decline by -2% during 2018, and by -1% during 2019. In 2020, the market is expected to remain flat with no further decline.

Planning assumptions for all other key segments are based on external sources and indicate slightly positive growth across all segments during the same time period.

Progress on cost savings

As announced in the report for the second quarter 2017, cost reduction activities are accelerated to achieve an annual run rate reduction of at least SEK 10 b. by mid-2018, split between General & Administration (30%) and Cost of Sales (70%). At the end of Q317 a SEK 2 b. run rate reduction had been achieved, of which SEK 1.8 b. in cost of sales.

Restructuring charges for full year 2018 are estimated to SEK 5 – 7 b.  

New financial reporting structure

Ericsson will introduce a new financial reporting structure as of Q4 2017, based on the new company structure. Results will be reported in four segments: Networks, Digital Services, Managed Services and Other. Each segment includes the combined sales from products and services except for segment Managed Services that consists of services only.

IPR revenues will be split 82% in Networks and 18% in Digital Services.

Segment Other will consist of Media Solutions, Broadcast & Media Services, and Emerging Business.

The restated numbers for 2016 and 2017 will be disclosed on December 8, 2017, ahead of the fourth quarter and full year 2017 report.

Details of the event

President and CEO Börje Ekholm and CFO Carl Mellander will be joined by members of the company's Executive Team. The speakers include Fredrik Jejdling, Head of Business Area Networks, Ulf Ewaldsson, Head of Business Area Digital Services, and Peter Laurin, Head of Business Area Managed Services as well as CTO Erik Ekudden and Nishant Batra, Head of Network infrastructure.

Ericsson's Capital Markets Day event can be accessed via the Ericsson website https://www.ericsson.com/en/investors/events-and-presentations/CMD2017. Presentation materials can also be downloaded from the website once the webcast has started.

NOTES TO EDITORS

For media kits, backgrounders and high-resolution photos, please visit www.ericsson.com/press

FOLLOW US:

www.twitter.com/ericsson

www.facebook.com/ericsson

www.linkedin.com/company/ericsson

www.youtube.com/ericsson 

MORE INFORMATION AT:

News Center

Media Contact:

Peter Nyquist, Head of Investor Relations

Phone: +46-10-714-64-99

E-mail: peter.nyquist@ericsson.com


Ericsson Investor Relations

Phone: +46-10-719-00-00

E-mail: investor.relations@ericsson.com


Ericsson Corporate Communications

Phone: +46-10-719-69-92

E-mail: media.relations@ericsson.com

Ericsson is a world leader in communications technology and services with headquarters in Stockholm, Sweden. Our organization consists of more than 111,000 experts who provide customers in 180 countries with innovative solutions and services. Together we are building a more connected future where anyone and any industry is empowered to reach their full potential. Net sales in 2016 were SEK 222.6 billion (USD 24.5 billion). The Ericsson stock is listed on Nasdaq Stockholm and on NASDAQ in New York. Read more on www.ericsson.com.

Ericsson Forward-Looking Statement

All statements made or incorporated by reference in this release, other than statements or characterizations of historical facts, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by us. Forward-looking statements can often be identified by words such as "anticipates", "expects", "intends", "plans", "predicts", "believes", "seeks", "estimates", "may", "will", "should", "would", "potential", "continue", and variations or negatives of these words, and include, among others, statements regarding: (i) strategies, outlook and growth prospects; (ii) positioning to deliver future plans and to realize potential for future growth; (iii) liquidity and capital resources and expenditure, and our credit ratings; (iv) growth in demand for our products and services; (v) our joint venture activities; (vi) economic outlook and industry trends; (vii) developments of our markets; (viii) the impact of regulatory initiatives; (ix) research and development expenditures; (x) the strength of our competitors; (xi) future cost savings; (xii) plans to launch new products and services; (xiii) assessments of risks; (xiv) integration of acquired businesses; (xv) compliance with rules and regulations and (xvi) infringements of intellectual property rights of others. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward looking statements. These forward-looking statements speak only as of the date hereof and are based upon the information available to us at this time. Such information is subject to change, and we will not necessarily inform you of such changes. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Important factors that may cause such a difference for Ericsson include, but are not limited to: (i) material adverse changes in the markets in which we operate or in global economic conditions; (ii) increased product and price competition; (iii) reductions in capital expenditure by network operators; (iv) the cost of technological innovation and increased expenditure to improve quality of service; (v) significant changes in market share for our principal products and services; (vi) foreign exchange rate or interest rate fluctuations; and (vii) the successful implementation of our business and operational initiatives.

This information is information that Telefonaktiebolaget LM Ericsson is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above at 14:30 CET on November 8, 2017.

This information was brought to you by Cision http://news.cision.com

http://news.cision.com/ericsson/r/ericsson-capital-markets-day-2017,c2385783

The following files are available for download:

http://mb.cision.com/Main/15448/2385783/748277.pdf

Ericsson Capital Markets Day 2017

Modal title

Also from this source

Invitation to media and analyst briefing for Ericsson Q2 2025 report

Ericsson's (NASDAQ: ERIC) financial report for the second quarter 2025 will be published at approximately 7:00 AM CEST on July 15, 2025. The company...

EMR June 2025 highlights growing monetization appeal of 5G fixed wireless access

Fixed Wireless Access (FWA) continues to grow in appeal to communications service providers (CSPs) around the world, with the ability to offer...

More Releases From This Source

Explore

Computer & Electronics

Computer & Electronics

Accounting News & Issues

Accounting News & Issues

News Releases in Similar Topics

Contact PR Newswire

  • +44 (0)20 7454 5110
    from 8 AM - 5:30 PM GMT
  • General Enquiries
  • Media Enquiries
  • Partnerships

Products

  • Content Distribution
  • Multimedia Services
  • Disclosure Services
  • Cision Communications Cloud®

About

  • About PR Newswire
  • About Cision
  • Partnering Opportunities
  • Careers
  • Accessibility Statement
  • APAC
  • APAC - Simplified Chinese
  • APAC - Traditional Chinese
  • Brazil
  • Canada
  • Czech
  • Denmark
  • Finland
  • France
  • Germany
  • India
  • Indonesia
  • Israel
  • Japan
  • Korea
  • Mexico
  • Middle East
  • Middle East - Arabic
  • Netherlands
  • Norway
  • Poland
  • Portugal
  • Russia
  • Slovakia
  • Spain
  • Sweden
  • United States
  • Vietnam

My Services

  • All News Releases
  • Customer Portal
  • Resources
  • Blog
  • Journalists
  • Data Privacy

Do not sell or share my personal information:

  • Submit via Privacy@cision.com 
  • Call Privacy toll-free: 877-297-8921

Contact PR Newswire

Products

About

My Services
  • All News Releases
  • Customer Portal
  • Resources
  • Blog
  • Journalists
+44 (0)20 7454 5110
from 8 AM - 5:30 PM GMT
  • Terms of Use
  • Privacy Policy
  • Information Security Policy
  • Site Map
  • RSS
  • Cookie Settings
Copyright © 2025 PR Newswire Europe Limited. All Rights Reserved. A Cision company.