ERICSSON LM TELEPHONE CO Earnings Summary — Q1 2026

• Revenue fell by over 10% year-over-year to 49.3 billion SEK, reflecting a cooling 5G infrastructure cycle.
• Net income saw a dramatic decline of approximately 78.6% compared to the prior sequential quarter.
• Operating income plummeted to 1.44 billion SEK from 5.93 billion SEK in the same quarter last year.
• The North American market continues to face inventory adjustments and reduced capital expenditure from major carriers.
• The Enterprise segment, including Vonage, remains under scrutiny following massive historical impairments.
• Gross profit margins decreased to 47.2% vs 48.2% in the prior year period as product mix shifted.
• Research & Development expenses rose to 13.5 billion SEK, putting additional pressure on operating margins.

Management expects a challenging phase to persist as mobile infrastructure spending remains cyclical and sensitive to regional telco capex, particularly following the cooling of Indian 5G rollouts.

Deteriorating

Earnings quality and profitability have sharply declined from the previous year, driven by lower volumes and higher investment in R&D despite falling sales.

The outlook remains clouded by high customer concentration and a saturated telecom equipment market, with future growth heavily tied to the execution of the Vonage API strategy and a potential recovery in North American demand.