Ericsson reports second quarter results

- Sales SEK 48.5 (47.6) b., 7% growth in constant currencies, SEK 92.7 (89.8) b. first six months
- Operating income SEK 4.7 1) (9.3) b., excl. restructuring charges of SEK 1.8 b., SEK 9.0 (17.4) b. first six months, excl. restructuring charges of SEK 2.6 b.
- Operating margin 9.7% 1) (19.4%), excl. restructuring charges of SEK 1.8 b., 9.7% (19.4%) first six months, excl. restructuring charges of SEK 2.6 b.
- Cash flow SEK 8.5 (4.2) b., SEK 13.3 (8.8) b. first six months
- Net income 2) SEK 1.9 1) (6.4) b., incl. restructuring charges of SEK 1.8 b., SEK 4.5 (12.2) b. first six months, incl. restructuring charges of SEK 2.6 b.
- Earnings per share 2) SEK 0.60 1) (2.02) 3), SEK 1.43 (3.85) 3) first six months

1) Includes a capital gain of SEK 0.2 b. from divestment of enterprise PBX operations
2) Attributable to stockholders of the Parent Company, excluding minority interests.
3) A reverse split 1:5 was made in June 2008. Comparable figures restated accordingly.

CEO COMMENTS

"The overall business activity shows stable development," said Carl-Henric Svanberg, President and CEO of Ericsson (NASDAQ:ERIC). "With no major changes in the market environment, we still find it prudent to plan for a flattish mobile infrastructure market in 2008 and our focus on adjusting our cost base remains.

Sales have continued to pick up in the US, Western Europe has remained slow while we see good development in most high-growth markets. The continued decline of the USD impacts sales growth and margins negatively also in this quarter.

Networks showed a sequential margin improvement despite a continued high proportion of buildouts of new networks in high-growth markets, including accelerating volumes to India. Professional Services continues to develop favorably with stable margins and Multimedia shows good growth with a lower operating loss.

In the wireless market, expansions of GSM, buildouts of HSPA and early discussions on LTE continue in parallel and these technologies will coexist for many years. Access to telephony as well as Internet, with multimedia solutions for e-business, e-health, e-learning, e-banking etc, are key elements for sustainable development. This is driving buildouts of mobile communications in high-growth markets as well as the buildout of broadband in mature markets" said Carl-Henric Svanberg.

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