Ericsson: Thanks a Lot, Sony
Telecom equipment maker Ericsson reported earnings this morning, and while the Swedish company is obviously doing better than some of its rivals, it’s not doing all that much better. This morning the company posted a 35 percent drop in first-quarter profit, its financials undermined by its Sony Ericsson joint venture (which reported a loss of 293 million euros) and by customers postponing purchases because their local currency has collapsed. Net profit in the quarter was 1.7 billion kronor ($210 million) compared with 2.6 billion kronor in the same period a year ago.
Now we know why Ericsson declined to offer a specific business outlook for 2009 when it last reported earnings. That said, the company seems to believe that the effects of global recession on its business are limited so far. Investments in wireless networks apparently continue apace, econalypse be damned.
“I think we have had a decent start of the year,” CEO Carl-Henric Svanberg said during a conference call with analysts. “We continue to gain market share. We had several strategic wins, we’re doing good in managed–both networks and managed services. There are some but still limited effects from the economic recession and still I think this is not the time to be too precise and predicting but realize that this is a very unusual time.”