Ericsson reported an increase in revenues, but a dip in profits in Q3 as business activity in the US market slowed.
The firm reported revenues of SEK57.6 billion (€6.26 billion), up 9% year-on-year or 3% adjusted for currency.
However, net income was down 13% to SEK2.6 billion while operating income dropped 8% to SEK3.9 billion, which Ericsson said was was mainly driven by the revaluation of unrealised hedge contracts.
“The sales growth year-over-year was mainly driven by the Middle East, China, India and Russia, but was partly offset by lower sales in North America,” said Ericsson president and CEO Hans Vestberg.
“Sales in North America continued to be driven by operator investments in capacity and quality enhancements. However, business activity slowed down during the quarter as operators currently focus on cash flow optimisation.”
Ericsson said that profitability showed stable improvement across all segments and that it continues to execute on plans to improve profitability in its core business in order to invest in targeted areas such as IP networks, cloud, TV and media and OSS and BSS.
Vestberg said that during the quarter, Ericsson took the strategic decision to stop all further development on modems and to shift some R&D resources from its modems segment to networks “to pursue growth opportunities in the radio business.”
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