Telefonaktiebolaget LM Ericsson Stock Price, News & Analysis

Ericsson has reached a significant milestone, securing its 100^th commercial 5G agreement with unique service providers as of August 12, 2020. This accomplishment includes 56 live networks across five continents, reinforcing Ericsson's position in the global 5G landscape. CEO Börje Ekholm highlighted the company's commitment to customer needs, which has been central to their technological advancements. The milestone showcases Ericsson's extensive experience in 5G deployments, supported by products like the Ericsson Radio System and Cloud Core. This achievement positions Ericsson favorably as demand for 5G technology continues to rise.

Ericsson (NASDAQ: ERIC) launched Slovenia's first commercial 5G network in partnership with Telekom Slovenije on July 23, 2020, within a week of signing the contract. The initial rollout covers major cities, reaching about 25% of the population, with plans to expand to 33% by year-end. The network utilizes Ericsson's Radio System and Packet Core equipment, allowing efficient spectrum sharing. The deployment aims to enhance mobile data services, supporting emerging technologies like IoT and AR/VR. This move positions Slovenia as a leader in digital connectivity in Europe.

Ericsson has secured a multi-year deal with Deutsche Telekom for the deployment of a 5G Radio Access Network (RAN) across Germany. This partnership builds upon the successful modernization of Deutsche Telekom's existing 2G, 3G, and 4G networks. Key features include the use of Ericsson Radio System products and Ericsson Spectrum Sharing technology, which will enhance network flexibility and efficiency in managing 4G and 5G traffic. The deal emphasizes their strong collaboration and commitment to delivering advanced telecommunications solutions.

Ericsson has been selected by SoftBank to deliver a cloud-native dual-mode 5G Core for the company's standalone 5G services. This technology will allow SoftBank to innovate new use cases across consumer and enterprise sectors. The dual-mode 5G Core features zero-touch operations and enhances operational efficiency through automation and a microservice architecture. With 99 commercial 5G agreements globally, Ericsson continues to expand its footprint in the 5G market, supporting 54 active 5G networks worldwide.

Ericsson reported Q2 2020 sales of SEK 55.6 billion, a 1% increase YoY, with adjusted sales flat. Gross margin improved to 38.2% from 36.7%, largely due to higher software sales. Operating income rose to SEK 4.5 billion, achieving an operating margin of 8.2%. Net income increased by 40% to SEK 2.6 billion. Free cash flow before M&A jumped to SEK 3.2 billion. Despite Covid-19 uncertainties, Ericsson maintains its full-year financial targets, emphasizing strong performance in Networks with a 4% organic sales growth.

On July 9, 2020, Ericsson announced that its second quarter 2020 financial report will be published on July 17, 2020, at 7:00 AM CEST. The report will be accessible on the company's website, along with a detailed press release including tables in PDF format. Following the release, a conference call hosted by President and CEO Börje Ekholm and CFO Carl Mellander will occur at 9:00 AM CEST to discuss the report. Analysts, investors, and journalists can join the call via designated phone numbers or through a live audio webcast.

Ericsson has launched its Standalone 5G NR software, now globally available as of June 2020. This software allows communications service providers to operate 5G networks without relying on underlying LTE networks. It supports faster connection times and improved user experiences, especially for applications needing low latency like AR/VR. T-Mobile and Telstra are among the partners trialing this software. Standalone 5G devices are expected to be available later in 2020. This development positions Ericsson to enhance its 5G offerings and expand its portfolio in emerging markets.

Ericsson has introduced two new antenna-integrated radio solutions, the Hybrid AIR and Interleaved AIR, which facilitate quicker and broader deployment of mid-band 5G networks without requiring additional site space. These innovations allow communications service providers to enhance their existing infrastructure, enabling faster rollouts of Massive MIMO technology while reducing optimization costs. Partnerships with Swisscom and Vodafone have showcased the benefits of these solutions, achieving up to seven times the mobile broadband capacity compared to existing antennas.

Ericsson forecasts that global 5G subscriptions will exceed 190 million by the end of 2020 and reach 2.8 billion by 2025. The June 2020 Ericsson Mobility Report highlights an increased reliance on digital infrastructure during the COVID-19 pandemic, with mobile and fixed networks becoming crucial for connectivity. Despite slow growth in some markets, overall 5G subscription projections have been raised. The report also indicates significant growth in Fixed Wireless Access (FWA), expected to account for 25% of global mobile data traffic by 2025.