Ericsson reports fourth quarter results and full-year results 2024
STOCKHOLM, Jan. 24, 2025 /PRNewswire/ -- Strategic highlights - continuing to deliver on strategic and operational priorities
-- Maintaining leadership in programmable networks, with new 5G Advanced
software launched in October.
-- Growing interest in network APIs, with financial fraud protection and
Quality on Demand applications in focus.
-- Further patent licensing agreement signed in Q4, with strong IPR revenue
generation in 2024.
Fourth quarter highlights - growth in Networks sales, and strong gross margin expansion
-- Sales increased by 2%* YoY, with 54%* growth in market area North
America. Market area Europe and Latin America also grew, while the other
market areas declined significantly. Reported sales were SEK 72.9 (71.9)
b.
-- Adjusted(1) gross income increased to SEK 33.7 (29.6) b. driven by
strong expansion in Networks adjusted[1] gross margin to 49.1% (43.2%).
Reported gross income was SEK 32.7 (28.6) b.
-- Adjusted(1) gross margin was 46.3% (41.1%) driven by supply chain
efficiency actions, commercial discipline and market mix. Reported gross
margin was 44.9% (39.8%).
-- Adjusted(1) EBITA was SEK 10.2 (8.2) b. with a 14.1% (11.4%) margin,
benefiting from higher gross income and cost actions, partly offset by
bonus accruals which were above target level. EBITA was SEK 8.6 (6.7) b.
-- Net income was SEK 4.9 (3.4) b. EPS diluted was SEK 1.44 (1.02).
-- Free cash flow before M&A was SEK 15.8 (12.5) b. supported by earnings
growth and improved working capital.
Full-year highlights - strong growth in North America, and strong free cash flow
-- Sales declined by -5%*, impacted by a -6%* sales decrease in Networks.
Reported sales were SEK 247.9 (263.4) b.
-- Adjusted(1) gross income increased to SEK 111.4 (104.4) b. with an
increased contribution from all segments.
-- Adjusted(1) EBITA was SEK 27.2 (21.4) b. with an adjusted[1] EBITA
margin of 11.0% (8.1%).
-- Adjusted(1) EBIT margin was 3.8% (-5.2%).
-- Net income was SEK 0.4 (-26.1) b. EPS diluted was SEK 0.01 (-7.94).
-- Free cash flow before M&A was SEK 40.0 (-1.1) b. Working capital
contributed strongly, benefiting from market mix and customer payment
phasing, as well as the structural actions taken to improve supply chain
efficiency.
-- Net cash at year-end 2024 was SEK 37.8 (7.8) b.
-- Return on capital employed was 2.5% (-10.7%).
-- A dividend for 2024 of SEK 2.85 (2.70) per share will be proposed to the
AGM by the Board of Directors.
Börje Ekholm, President and CEO, said: "Q4 marks a strong end to 2024 for Ericsson. We progressed well against our strategic plan and generated strong free cash flow. Momentum around programmable networks for differentiated performance continued to build, and customers increasingly recognize the benefits of making mobile networks accessible through APIs. In Q4, we signed an open programmable network deal with MasOrange, a first for Europe.
We see further signs that the overall RAN market is now stabilizing, with strong growth in North America supporting a return to Networks sales growth in Q4. Progress on operational excellence continued, with commercial discipline and supply chain efficiency actions supporting a strong adjusted Group gross margin of 46.3% in the quarter. We are not yet at our long-term EBITA goal, but we are progressing towards it, supported by our strategic actions.
For 2025, in Networks we will continue to benefit from our product leadership position, with the best performance and energy efficiency in the industry. In Enterprise, our priority remains stabilizing the commercial performance in the current portfolio and driving growth in areas such as mission critical and enterprise private networks. Our commitment remains to put high-performing, programmable and differentiated networks at the center of the digitalization of enterprise and society."
* Sales adjusted for the impact of acquisitions and divestments and effects of foreign currency fluctuations.
(1)Adjusted metrics exclude restructuring charges.
SEK b. Q4 2024 Q4 2023 YoY change Q3 2024 QoQ change Jan-Dec Jan-Dec
2024 2023 YoY change
Net sales 72.913 71.881 1 % 61.794 18 % 247.880 263.351 -6 %
Organic sales growth1 2 - 2 % -5 %
Gross margin(2) 44.9 % 39.8 % 45.6 % 44.1 % 38.6 %
EBIT (loss) 7.958 5.848 36 % 5.774 38 % 4.313 -20.326
EBIT margin(2) 10.9 % 8.1 % 9.3 % 1.7 % -7.7 %
EBITA(2) 8.623 6.694 29 % 6.203 39 % 22.145 14.912 49 %
EBITA margin(2) 11.8 % 9.3 % 10.0 % 8.9 % 5.7 %
Net income (loss) 4.879 3.409 43 % 3.881 26 % 0.374 -26.104
EPS diluted, SEK 1.44 1.02 41 % 1.14 26 % 0.01 -7.94
Free cash flow before M&A(2) 15.824 12.464 27 % 12.944 22 % 40.034 -1.084
Net cash, end of period(2) 37.830 7.832 383 % 25.534 48 % 37.830 7.832 383 %
Adjusted financial measures 2 3
Adjusted gross margin 46.3 % 41.1 % 46.3 % 44.9 % 39.6 %
Adjusted EBIT (loss) 9.584 7.368 30 % 7.327 31 % 9.325 -13.805
Adjusted EBIT margin 13.1 % 10.3 % 11.9 % 3.8 % -5.2 %
Adjusted EBIT excluding impairments4 9.797 7.368 33 % 7.327 34 % 24.658 18.111 36 %
Adjusted EBIT margin excluding impairments4 13.4 % 10.3 % 11.9 % 9.9 % 6.9 %
Adjusted EBITA 10.249 8.214 25 % 7.76 32 % 27.157 21.433 27 %
Adjusted EBITA margin 14.1 % 11.4 % 12.6 % 11.0 % 8.1 %
(1) Sales adjusted for the impact of acquisitions and divestments and effects of foreign currency fluctuations.
(2) Non-IFRS financial measures are reconciled at the end of this report to the most directly reconcilable line items in the financial statement.
(3) Adjusted metrics exclude restructuring charges
(4) Excluding the non-cash impairments recorded in the second and fourth quarter 2024, relating to the impairment of intangible assets mainly attributed to the Vonage acquisition.
NOTES TO EDITORS
You find the complete report with tables in the attached PDF or on www.ericsson.com/investors
Video webcast for analysts, investors and journalists
President and CEO Börje Ekholm and CFO Lars Sandström will comment on the report and take questions at a live video webcast at 9:00 AM CET (8:00 AM GMT London, 3:00 AM EST New York).
Join the webcast or please go to www.ericsson.com/investors
To ask a question: Access dial-in information here
The webcast will be available on-demand after the event and can be viewed at www.ericsson.com/investors.
FOR FURTHER INFORMATION, PLEASE CONTACT
Contact person
Daniel Morris, Head of Investor Relations
Phone: +44 7386657217
E-mail: investor.relations@ericsson.com
Additional contacts
Stella Medlicott, Senior Vice President, Marketing and Corporate Relations
Phone: +46 730 95 65 39
E-mail: media.relations@ericsson.com
Investors
Lena Häggblom, Director, Investor Relations
Phone: +46 72 593 27 78
E-mail: lena.haggblom@ericsson.com
Alan Ganson, Director, Investor Relations
Phone: +46 70 267 27 30
E-mail: alan.ganson@ericsson.com
Media
Ralf Bagner, Head of Media Relations
Phone: +46 76 128 47 89
E-mail: ralf.bagner@ericsson.com
Media relations
Phone: +46 10 719 69 92
E-mail: media.relations@ericsson.com
This 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 07:00 CET on January 24, 2025.
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The following files are available for download:
https://mb.cision.com/Main/15448/4095452/3222352.pdf Q4 full-year
2024
https://mb.cision.com/Public/15448/4095452/8d46fd1cd72a1cf8.xlsx Q4 full-year
2024
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SOURCE Ericsson
