Ericsson Reported Solid Q3 Results

Ericsson reported a robust revenue increase in the third quarter of 2026, with performance bolstered by expanded sales within its Networks division and the implementation of effective efficiency measures. However, the newly appointed CEO, Per Narvinger, cautioned about potential market challenges over the forthcoming year.

Revenue for the period rose 6% year-over-year to SEK 59.5 billion ($6 billion), with Networks sales increasing 9% to SEK 38.7 billion. Cloud Software and Services grew by 3% to SEK 15.8 billion, while Enterprise sales contracted by 10% to SEK 4.6 billion, a decline attributed to the divestment of iconectiv.

Sales experienced growth across most regions, including Asia and Europe, though these gains were offset by performance in the Americas and specific challenges in Latin America. Intellectual Property Rights (IPR) licensing revenue reached SEK 3.9 billion, up from SEK 3.1 billion, driven in part by retroactive payments from previously unlicensed products. Net income, however, decreased 49% to SEK 5.8 billion.

Overseeing his inaugural results announcement since succeeding Borje Ekholm last month, former Networks chief Narvinger noted that a consistent theme emerged from his recent customer engagements: the requirement for more intelligent and autonomous networks to enhance performance, efficiency, and resilience.

“The RAN market is flat, geopolitical uncertainty remains elevated, and component costs are a headwind to gross margin next year,” Narvinger emphasized in his forward-looking remarks. He expressed confidence that through disciplined execution and a focus on technological leadership, the company is well-positioned to navigate these impediments and secure profitable long-term growth.

Simultaneously with the results, the Swedish vendor delineated a restructured group organization designed to leverage its R&D capabilities and target cost efficiencies. This reorganization includes the establishment of a new Asia-Pacific Market Area beginning in 2027, which will consolidate the North East Asia and South East Asia, Oceania, and India market areas. The company asserts this shift will allow Ericsson to operate with greater effectiveness throughout the region.

The new division will be led by Patrick Johansson, currently the head of Market Area Europe, Middle East, and Africa, with a succession process for his current role now underway. Furthermore, the company is restructuring its Enterprise Wireless Solutions business area to prioritize indoor solutions, while transitioning the unit's existing portfolio to other divisions, including Networks.