Ericsson CEO Borje Ekholm has explained the reasons for the dismal performance during 2017 and the company strategy to turn around.
Ericsson has posted revenue of SEK 57.2 billion (–12 percent) in Q4 and SEK 201.3 billion (–10 percent) in 2017 due to lower sales in all businesses.
Ericsson reported net loss of SEK 18.9 billion in Q4 and net loss of SEK 35.1 billion in 2017. The Sweden-based telecom equipment maker had posted net loss of SEK 1.6 billion in Q4 2016 and net income of SEK 1.9 billion in 2016.
Operating margin of Ericsson was –34.5 percent in Q4 2017 against –0.4 percent in Q4 2016. Ericsson’s operating margin was –18.9 percent in 2017 as compared with 2.8 percent in 2016.
Ericsson CEO today announced new strategies to save the company from turmoil due to slump in telecom investment and competition from Nokia and Huawei.
Ericsson has named Asa Tamsons as the head of newly created Emerging Business division to focus on innovation and new business development, with initial focus on IoT and 5G.
Asa Tamsons joins Ericsson from McKinsey & Company where she has held the position as partner in McKinsey’s Stockholm office. Her primary focus has been growth strategy, marketing and sales, high tech, and telecommunications, across Europe, the U.S., and Latin America.
The majority of Group Function Technology & Emerging Business, including hosted group responsibilities such as the CTO office and Ericsson Research, will be part of Emerging Business.
Ericsson has named Helena Norrman as the head of Marketing & Corporate Relations that will be created by merging Marketing & Communications and Sustainability & Public Affairs.
Ulf Ewaldsson, head of Digital Services business, and Elaine Weidman, head of Group Function Sustainability & Public Affairs, will leave Ericsson.
Ulf Ewaldsson will assume the role as advisor to the CEO.
Jan Karlsson, currently head of BSS business, will step in as acting head of Digital Services at Ericsson.
Elaine Weidman-Grunewald has decided to leave the company to pursue other opportunities.
Media business gets partner
Ericsson has offered 51 percent equity stake to One Equity Partners, a private equity firm with expertise in media and telecom investments, to develop Media Solutions. This structure will establish Media Solutions as a leading video technology company with financial support driving investment in innovation and growth.