Telefonaktiebolaget LM Ericsson reported second-quarter diluted earnings of SEK 1.22 per share. This result surpassed the consensus analyst estimate of SEK 1.19 per share.
Total revenue fell 6.1% year-over-year to SEK 52.7 billion. This figure missed the forecasted SEK 54.04 billion. Organic sales decreased by 1% year-over-year. Lower IPR licensing revenues drove the decline following a one-time benefit in the previous year. Adjusted gross margin improved to 48.4% through operational execution.
CEO Börje Ekholm highlighted the company's portfolio strength and disciplined execution. However, Ericsson anticipates profitability challenges in the third quarter. Rising semiconductor costs driven by AI demand will impact future results.
ERIC shares rose 3.3% following the report. The stock traded at $11.72 per share. Investors prioritized the company's margin resilience and cost management over the revenue shortfall.