But net sales were down two percent year-on-year at 52.2 billion kronor, below market expectations of 54.4 billion as forecast by a Bloomberg poll of analysts, while like for like sales slipped one percent.
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“We are confident in our ability to achieve net annual savings of nine billion kronor during 2017 compared with 2014”, the group said in highlighting three focus areas for 2016 – core business, improved profitability in targeted growth areas and improved cost and efficiency.
Revenue for the quarter ended March 31 was SEK 2.7 billion (Rs2,208 crore), down from SEK 3.5 billion a year ago, and from SEK 3.1 billion in the fourth quarter. BU (business unit) Network Products will be headed by Arun Bansal while BU Network Services will be headed by Fredrik Jejdling. “As 5G, the Internet of Things and Cloud drive the next phase of industry development, the time is right to make the change”, said Hans Vestberg.
Nokia, which had a 16% operating margin last year against 9% for Ericsson excluding restructuring charges, is seen by analysts as a more efficient company after years of measures to boost profits and streamline operations.
Executives said the company needed to work on adapting service delivery operations to align with the decline in mobile broadband project volumes that Vestberg had earlier noted. Poirault, now head of Consulting and Systems Integration, will also be a new member of the ELT, joined by Sund, now head of Region Northern Europe and Central Asia, and Weidman-Grunewald.
The company is creating business units targeting media and enterprise customers, part of Vestberg’s aggressive push to expand beyond the shrinking wireless-network market. We are today announcing further actions to accelerate strategy execution and to drive efficiency and growth across the company even harder. The two business units will leverage the combined strength in products and services with BU Networks Services focusing on Managed Services, Network Roll-Out and Customer Support and BU Network Products combining Radio and Transport. The fifth will house Ericsson’s media business.
Ericsson is also promoting Niklas Heuveldop to senior VP and head of sales for the company.
Most to blame geography-wise was Europe, still “weak” in macroeconomic terms, while North America, China and part of Asia saw a slight uptick to part compensate.
At the same time head of region North America, Angel Ruiz, and executive vice-president and head of segment and business unit global services, Magnus Mandersson, will leave the executive leadership team on July 1 and take new roles within the company.
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First quarter sales for the company’s networks unit were $3.2 billion, sales for its global services unit were $2.8 billion and sales for its support solutions unit were $419 million.
