Ericsson CEO: Mobile communications leader retains 'strong' shape

As fast and ubiquitous mobile communication is becoming a new force to drive economic development, Ericsson, global leader of communications and services, believes that the world will become more dynamic and integrated with the technology.

For Ericsson itself, the global information and communications technology leader, remains in a strong position in 2014 to continue to support transformation of industries and acceleration of business models and living styles, said Hans Vestberg, president and chief executive officer of Ericsson.

Despite economic slowdowns in some major emerging economies, including China, India and Brazil, and fiercer market competition, Ericsson managed to achieve a 5-percent sales growth from US$35.8 billion in 2012, and even doubled profits in 2013, the company's 2013 financial report revealed.

Ericsson has a strong balance sheet. The corporation's net profit rose by 108 percent year-on-year to reach US$1.85 billion thanks to its strategic reorientation to more profitable growth areas.

Last year, Ericsson took a number of strategic initiatives to manage technology transitions in the ICT industry and transform the company for future business opportunities, by solidifying its core business in mobile networks and global services, and executing on important steps to build leadership positions in new and targeted key areas – business and operating support solutions, LTE modems, mobile and TV media and cloud technology.

"Our focus on profitability started to pay off and operating margin for the group gradually improved in 2013, driven primarily by improvements in networks and network rollout," CEO Hans Vestberg said.

Ericsson is market leader in North America market in both telecom services and mobile infrastructure. Its sales in China market improved last year, as the Ministry of Industry and Information Technology issued 4G LTE licenses in December. Ericsson was chosen as networks providers to major Chinese operators.

Entering 2014, Ericsson has clinched two important deals, making the telecom maker in better position to deal with rising market competition.

In late January, Ericsson and mobile phone giant Samsung inked an agreement on global patent cross licensing, covering patents relating to GSM, UMTS and LTE standards for both networks and handsets. The multi-year agreement, based on fair, reasonable and non-discriminatory terms, is to benefit the industry while at the same time help Ericsson gain patent royalty incomes, analysts said.

And in early February, Ericsson entered into another deal to acquire Massachusetts based Azuki Systems, a provider of TV Anywhere delivery platforms for content owners and broadcasters. The agreement, together with Ericsson's last year acquisition of Microsoft's IPTV Mediaroom, will greatly extends Ericsson's leading TV and media solutions portfolio – a new growth point listed by the company.

Vestberg said that increasing smartphone penetration, mobile broadband consumption and 4G device lineup will drive for rising network expansion and strong professional services business in the coming years.

Ericsson, with more than 110,000 employees stationed in over 180 countries and regions, is global ICT provider. Today, 40 percent of the world's mobile traffic goes through Ericsson networks, which support a total of 2.5 billion end users worldwide.