Ericsson sales flat for last quarter and full year in 2013

Revenue and net income boosted in Q4 2013 thanks to patent licensing deal with Samsung; sales and revenue remained largely unchanged for the full year, but gross margins improved

Ericsson sales flat for last quarter and full year in 2013

Ericsson revenue and net income remained flat in the last quarter of 2013, in part thanks to boost from its recent patent licensing deal with Samsung.

Revenue for the full year also remained unchanged compared with 2013, but profitability more than doubled to Swedish Krona (SEK) 12.2bn (£1.1bn). In Q4 2013, net revenue was unchanged year-on-year at SEK 67.0bn (£6.2bn), but up 27% on the previous quarter, Q3 2013.

The Networks division was the largest revenue earner at SEK 34.8bn (£3.2bn), down 1% yr-on-yr, but up 30% on the quarter. Global Services brought in SK 27.1bn (£2.5bn), a decrease of 3% yr-on-yr, up 13% on Q3 2013. Support Solutions took in SEK 5.1bn (£474m), a rise of 41% yr-on-yr and up 117% on the previous quarter.

Net income for Q4 2013 was SK 6.4bn (£585m), although this was boosted by SEK 3.3bn (£306m) from the Samsung deal. However, the result was a major improvement on Q4 2012, when Ericsson posted a loss of SEK 6.3bn (£585m) after being hit by losses at is chip manufacturing joint venture ST-Ericsson.

Figures for the full year 2013 saw revenue unchanged at SEK 227.4bn (£21.4bn). Net income rose by 105% yr-on-yr to SEK 12.2bn (£1.1bn). Gross margin for the year rose from 31.6% in 2012 to 33.6% in 2013. Gross margin for Q4 2013 was 37.1% (32.9% without the Samsung boost) – but both figures were above the 31.1% gross margin achieved in 2012.

In the full year, North America easily provide the most sales, followed by North East Asia, the Mediterranean and Latin America. However, Hans Vestberg, president and CEO, warned that major projects in North America had peaked in the first half of 2013 and that there was reduced activity in Japan.

Ericsson has picked up a share of LTE network roll outs in China with two of the three main operators so far, while sales in European key markets picked up in the last quarter of 2013.

Vestberg said: ‘The long-term fundamentals in the industry remain attractive and with our ongoing strategic initiative e are well positioned to continue to support our customers in a transforming ICT market.’

See also:

ZTE expects to return to profitability in 2013

Huawei says ‘innovation’ is behind its 8% increase in sales for 2013

NSN sales slump in Q4 2013 and as full year revenues drop by 18%



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