Ericsson (NASDAQ:ERIC) Announces Quarterly Earnings Results

Ericsson (NASDAQ:ERIC) issued its quarterly earnings data on Tuesday. The communications equipment provider reported $0.13 EPS for the quarter, hitting the consensus estimate of $0.13, Zacks reports. Ericsson had a net margin of 10.80% and a return on equity of 22.17%.

Here are the key takeaways from Ericsson’s conference call:

• Ericsson said Q2 execution was solid, with gross margin of 48% and EBITDA margin of 13.1%, highlighting continued disciplined cost control and operational resilience.
• Organic sales declined 1% year over year, but management said underlying growth was roughly flat excluding last year’s one-off IPR settlement. Reported sales were also pressured by currency headwinds.
• The company’s IPR revenue run rate is about SEK 13.5 billion, including new agreements signed in July 2026. Ericsson said these deals strengthen the value of its patent portfolio going forward.
• Ericsson warned that component cost inflation tied to the AI boom is rising and will gradually weigh on results in coming quarters. The company is responding with pricing actions, product redesigns, substitutions, and supply-chain measures.
• Management said the company is positioned to benefit from AI-driven growth in mobile connectivity, especially uplink-intensive and low-latency applications. It also sees opportunity in enterprise connectivity, APIs, mission-critical networks, and defense-related use cases.

Ericsson Stock Performance

Shares of ERIC stock traded down $1.42 during mid-day trading on Tuesday, hitting $10.30. The stock had a trading volume of 8,713,130 shares, compared to its average volume of 10,341,559. The firm has a market cap of $34.74 billion, a PE ratio of 13.04, a PEG ratio of 1.99 and a beta of 0.93. The company’s 50-day simple moving average is $12.09 and its 200-day simple moving average is $11.33. The company has a debt-to-equity ratio of 0.21, a current ratio of 1.12 and a quick ratio of 0.93. Ericsson has a fifty-two week low of $7.16 and a fifty-two week high of $13.77.

Wall Street Analyst Weigh In

A number of brokerages have issued reports on ERIC. Weiss Ratings reissued a “buy (b)” rating on shares of Ericsson in a research report on Tuesday, June 2nd. Wall Street Zen lowered Ericsson from a “buy” rating to a “hold” rating in a research report on Saturday, April 25th. Finally, Citigroup reaffirmed a “neutral” rating on shares of Ericsson in a research note on Tuesday, April 28th. One investment analyst has rated the stock with a Buy rating, six have assigned a Hold rating and two have assigned a Sell rating to the company’s stock. According to MarketBeat, the stock presently has an average rating of “Reduce” and a consensus target price of $11.00.

Institutional Investors Weigh In On Ericsson

Hedge funds have recently added to or reduced their stakes in the company. Defiance ETFs LLC acquired a new position in Ericsson during the fourth quarter worth $13,766,000. Van ECK Associates Corp raised its stake in shares of Ericsson by 229.3% during the 4th quarter. Van ECK Associates Corp now owns 1,252,437 shares of the communications equipment provider’s stock worth $12,086,000 after buying an additional 872,065 shares during the last quarter. Marshall Wace LLP boosted its position in shares of Ericsson by 234.2% in the 3rd quarter. Marshall Wace LLP now owns 1,078,145 shares of the communications equipment provider’s stock worth $8,916,000 after buying an additional 755,587 shares in the last quarter. Geode Capital Management LLC increased its holdings in Ericsson by 2.7% during the 4th quarter. Geode Capital Management LLC now owns 257,021 shares of the communications equipment provider’s stock valued at $2,480,000 after acquiring an additional 6,667 shares in the last quarter. Finally, AQR Capital Management LLC lifted its holdings in shares of Ericsson by 7.5% in the first quarter. AQR Capital Management LLC now owns 134,891 shares of the communications equipment provider’s stock valued at $1,049,000 after purchasing an additional 9,362 shares in the last quarter. Institutional investors and hedge funds own 7.99% of the company’s stock.

Key Ericsson News

Here are the key news stories impacting Ericsson this week:

• Negative Sentiment: Ericsson reported mixed second-quarter results, with lower sales and profit tied to weak Networks and Enterprise performance, and the company guided for softer Networks margins in the third quarter. Article Title
• Negative Sentiment: The company cautioned that rising component costs are pressuring profitability, with North America sales also declining and Networks margins expected to slip next quarter. Article Title
• Negative Sentiment: Market commentary said Ericsson saw one of its worst post-earnings reactions in nearly three years as investors reacted to margin pressure from higher memory-chip and other input costs. Article Title
• Negative Sentiment: Analysts published a bearish take on the quarter, arguing that the dip may not be a buying opportunity after the earnings release. Article Title
• Neutral Sentiment: Ericsson and AT&T showcased 5G network-sensing technology, and the company also announced a new legal hire at Ericsson Federal, but these developments are unlikely to move the stock on their own. Article Title Article Title
• Neutral Sentiment: The company continued buying back shares in July, which supports capital returns but is being overshadowed by the weaker earnings and outlook. Article Title

About Ericsson

Ericsson AB is a Swedish multinational telecommunications equipment and services company headquartered in Stockholm. Founded in 1876 by Lars Magnus Ericsson, the company designs, develops and sells infrastructure, software and services that enable mobile and fixed-line networks worldwide. Ericsson serves a global customer base that includes mobile network operators, enterprise customers and public-sector organizations across Europe, the Americas, Asia-Pacific, the Middle East and Africa.

The company’s core activities center on building and modernizing network infrastructure, with a particular focus on radio access networks (RAN), core network software, cloud-native solutions and network management systems.