- Telefonaktiebolaget L M Ericsson (NASDAQ:ERIC) reported a first-quarter FY22 sales growth of 11% year-on-year to SEK 55.1 billion.
- Group organic sales grew by 3% Y/Y, driven by Networks in North America, Europe, and Latin America.
- Organic sales in Networks rose 4% Y/Y, and Digital Services sales down by 2% Y/Y.
- It reported an EPS of SEK 0.88 versus SEK 0.96 last year.
- Adjusted gross margin contracted 60 basis points to 42.3% due to investments in network supply chain resilience.
- Adjusted EBIT margin declined by 200 bps to 8.7%.
- Ericsson saw strong business momentum, and its investments in technology and a resilient supply chain have allowed it to continue to win market share and deliver on customer commitments.
- Ericsson acknowledged the indefinite suspension of its business in Russia following current sanctions.
- Ericsson saw an unspecified DOJ penalty due to its failure to make adequate disclosures about its operations in Iraq before entering a deferred prosecution agreement in 2019.
- Price Action: ERIC shares traded lower by 6.30% at $8.77 in the premarket session on the last check Thursday.
