Ericsson posts higher profits, boosted by 5G rollout

Swedish telecoms equipment maker Ericsson on Friday announced greatly increased annual profits, boosted by the rollout of 5G networks.

However, the company also expressed worries it could suffer reprisals from China after its home country banned the use of competitor Huawei’s equipment in the next generation of phone networks.

“The pandemic has fast forwarded the digitalisation of societies, including remote working, by months if not years... We see more signs that countries and enterprises see 5G as a key access technology,” Ericsson CEO Borje Ekholm said in a comment to the annual results.

Ericsson, one of the leaders in 5G equipment, reported an annual net profit of 17.5 billion Swedish kronor (€1.7bn). This can be compared to a 2.2 billion kronor profit the previous year, though in 2019 the company was also burdened by settlements in a US corruption probe.

For 2020, turnover increased two per cent to 232 billion kronor, beating analyst expectations. The gross margin, excluding restructuring costs, which is the equipment makers preferred indicator of profitability, rose 3.1 percentage points to 40.6 per cent. 

To date, Ericsson has signed 127 commercial 5G contracts with...