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Ericsson results sour hopes of turnaround

Wednesday, July 17, 2013 - 01:23

July 18 - In a quarter hit by a large one-off charge, sales and margins at Ericsson's networks unit were well below expectations, dampening hopes of a quick turnaround. Ciara Sutton reports.

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250 million pounds is today's daily digit in Europe. It's the second-quarter earnings for world No. 1 mobile network gear maker Ericsson. The company's operating profits came in well below expectations, bruising hopes of a quick recovery at its core network unit. But Ericsson CEO Hans Vestberg remains upbeat. (SOUNDBITE) (ENGLISH) ERICSSON CEO HANS VESTBERG, SAYING: "For me it it was this gradual improvement that I've been talking about for the last three quarters, and we saw less of an impact on the European modernisation. And we saw a gradual slow shift into more capacity projects and coverage projects." The quarter was hit by a large one-off charge for divestments and high restructuring costs. And the results underline competition from Chinese equipment vendors like Huawei as well as economic gloom and currency headwinds. But the company downplayed any rivalry. (SOUNDBITE) (ENGLISH) ERICSSON CEO HANS VESTBERG, SAYING: "It boils down to we need to focus on what we''re doing at Ericsson and all other things we cannot control - that we'll have to leave." Ericsson - the biggest player with a market share of around 35 percent - may have weathered the global economic slump, but its shares have flatlined for the last 10 years. They were down around 4 percent on the results - the company's turnaround looks like it will take longer than expected.

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Ericsson results sour hopes of turnaround

Wednesday, July 17, 2013 - 01:23