Income ahead of forecast sends shares rising 17%
Written on April 27, 2008
STOCKHOLM–Swedish wireless-equipment maker LM Ericsson has reported better than expected results for the first quarter, despite a 55 per cent drop in earnings.
Net profit in the first three months of 2008 was 2.7 billion kronor, which was worth about $57 million (Canadian) at yesterday’s rate, compared with 5.8 billion kronor a year earlier. Sales rose to 44 billion kronor from 42 billion kronor.
"This was a really nice surprise," said eQ Bank analyst Jari Honko. "This shows that Ericsson is a shining star in the network industry.”
Honko said Ericsson’s operating profit beat the market consensus by about 16 per cent payday loans application. Despite Ericsson’s results, he cautioned that the network-infrastructure industry is in a "difficult phase.”
Ericsson reported higher costs in the most recent quarter, related to recent acquisitions, restructuring charges and research and development investments.
A 48 per cent drop in profits at mobile-phone joint venture Sony Ericsson also weighed on the Swedish company’s results.
Ericsson’s shares rose 16.6 per cent to close at 14.50 kronor, ($2.44).
Associated Press
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