- Q4 sales rise 2% despite regional challenges
- North America leads with a 54% increase in sales
What happened: Ericsson reports strong Q4 results as sales grow
Ericsson has concluded its Q4 2024 with a solid performance, showing resilience despite challenges in certain regions. The company reported a 2% increase in sales compared to the same quarter in 2023, reaching SEK 72.9 billion.
A standout contributor to this growth was North America, where sales surged by 54%. While some regions experienced setbacks, particularly in Networks, overall financial results were bolstered by strong growth in North America and better operational efficiency.
Adjusted gross margins rose significantly from 41.1% to 46.3%, attributed to improved supply chain management. The company’s free cash flow increased to SEK 15.8 billion from SEK 12.5 billion in 2023, and net income grew from SEK 3.4 billion to SEK 4.9 billion.
For the full year, Ericsson saw a 5% drop in sales, largely driven by a 6% decline in Networks sales. However, profitability improved with a notable increase in adjusted EBITA.
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Why it’s important
Ericsson’s Q4 results demonstrate strong operational performance, with key markets like North America driving growth in a challenging environment. The company’s ability to manage its supply chain effectively, as evidenced by the increased gross margin, is pivotal for sustaining profitability in the telecom sector.
Despite a decline in Networks sales over the year, the Q4 performance marks a return to growth in this segment, supported by stabilising conditions in the Radio Access Network (RAN) market. Furthermore, the rise in free cash flow indicates the company’s ability to generate strong returns and reinvest in future growth areas, particularly in programmable and differentiated networks.
As Ericsson continues to focus on its strategic goals for 2025, including stabilising its enterprise portfolio and driving innovation in mission-critical and private networks, its Q4 results offer insight into the company’s resilience and future potential in the competitive telecom landscape.
