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News
Issue #2002 - 17
(May 2002)
(Updated May
1, 2002)
ACQUISITIONS, MERGERS
& AGREEMENTS
Ericsson Failed to Meet First
quarter Revenue and Income Expectations
Swedish telecoms equipment
maker Ericsson has released its first quarter results for 2002,
losing more than $500-million, far lower than its $466-million
forecast. Its sales were a weaker than expected $3.5-billion and
orders in the first three months dropped 40 percent.
Highlights of Q1 Results
- Group sales were down 25 percent against the same period a
year earlier.
- Systems business division, which supplies infrastructure
equipment to fixed and mobile operators, was hit by a 19 percent
fall in sales.
- SonyEricsson, its joint mobile phone venture, returned a small
profit, beating earlier forecasts of a small loss.
With telecoms worldwide lowering investment plans further, the
company expects mobile network sales to fall more than 10 percent
this year, instead of the less than 10 percent expected.
Chief executive officer Kurt Hellstrom said he could not forecast
a recovery for the foreseeable future.
With prospects ‘way down,’ it was enviable that the company
would announce further job cuts of 20,000 over the next two years.
Ericsson also launched a $3-billion rights issue due by the end of
September.
Ericsson’s performance has now been added to the list of ‘gloom’:
Nokia, Nortel Networks, Lucent Technologies, Alcatel and Siemens
have all reported first quarter losses; and with each announcement,
Wall Street investors continued to batter an already wounded
industry.
For more information: http://www.ericsson.com
MobileInfo.com’s Comments & Advisory: We are
not fortune tellers with Tarot cards but it is obvious that wireless
infrastructure vendors will have to invoke the blessings of all the
Gods if they want a quick turn around.
Note: This news release may contain
forward-looking statements. Readers should take appropriate caution in
developing plans utilizing these products, services and technology
architectures. All trademarks used in this summary are
the property of their respective owners.
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