Telefonaktiebolaget LM Ericsson Class A · OMXSTO:ERIC_A

Telefonaktiebolaget LM Ericsson Class A — Ericsson — Q3 2004 Earnings Presentation

20 slides from Telefonaktiebolaget LM Ericsson Class A's earnings presentation, 2004

1. Slide 1: Third Quarter Report 2004

   hird uarter eport 2004 ERICSSON &

2. Slide 2: Safe Harbor Statement

   Safe Harbor Statement This presentation contains forward looking statements. Such statements are based on our current expectations and are subject to certain risks and uncertainties that could negatively affect our business. Please read our earnings reports and our most recent annual report for a be

3. Slide 3: Third Quarter Report

   Third Quarter Report CARL-HENRIC SVANBERG President and CEO

4. Slide 4: Leveraging market leadership

   Leveraging market leadership ƒ Continued solid performance – Sales up 14% YoY, Operating income SEK 7.2 b. ƒ Operational excellence paving the way – Growing market share and solid margins ƒ GSM/WCDMA track sales up ~25% YoY – Up >30% YoY, currency adjusted ƒ Sony Ericsson success continues © Copyrig

5. Slide 5: 3G highlights - market

   3G highlights - market ƒ WCDMA footprint expands – US deployments in 2005 ƒ Strong global WCDMA subscription growth – ~30% sequential increase – >10 million users ƒ 3G expands the market – “Internet in the pocket” – data, entertainment Well positioned for profitable growth © Copyright Telefon AB LM

6. Slide 6: 3G highlights - Ericsson

   3G highlights - Ericsson ƒ WCDMA rollout continues – Quickly catching up with GSM spending in Western Europe – Supplier to >50% of commercially launched WCDMA networks ƒ Continued strong demand for EDGE – Supplier to 25 of 35 launched EDGE networks ƒ Strengthened leadership – 3G Evolved – HSDPA, spe

7. Slide 7: Business highlights

   Business highlights 2G and services ƒ GSM rollout continues – New subscribers and networks - paving the way for 3G ƒ Continued success in high growth markets – 6 new GSM networks, Ericsson Expander a true growth driver ƒ Good growth in services – Sales up 16% year-to-date in local currencies – Manag

8. Slide 8: Regional Ericsson update

   Regional Ericsson update Status year-to-date ƒ Western Europe – Strong growth, 3G rollout, EDGE, GSM enhancements ƒ Central Europe, Middle East and Africa – Good growth, particularly in Eastern Europe ƒ Asia Pacific – Strong subscriber growth and continued rollouts – India strong, China prepares for

9. Slide 9: The new communications landscape

   The new communications landscape ”The triple play” – voice, data, entertainment Handsets Convenience through ”PC ” converged services TV, Video, Audio Always best connected Seamless services Mobile broadband © Copyright Telefon AB LM Ericsson 2004. All rights reserved THIRD QUARTER REPORT 2004 9

10. Slide 10: Increased focus on end-to-end

    Increased focus on end-to-end Convenience Consumer Ease of use, personal, reliable, secure Seamless services Operator Systems and services regardless of access method End-to-end Vendor Across systems, services, devices © Copyright Telefon AB LM Ericsson 2004. All rights reserved THIRD QUARTER REPORT

11. Slide 11: Telecoms has the winning proposition

    Telecoms has the winning proposition ƒ Mobility crucial part of consumer offering – Broadband goes mobile – mobile goes broadband ƒ Telecom grade is a prerequisite ƒ IP Technology with telecom grade – Reliability, security, and cost efficiency © Copyright Telefon AB LM Ericsson 2004. All rights rese

12. Slide 12: Only a few can deliver end-to-end

    Only a few can deliver end-to-end Operators focus on fewer partners with true end-to-end capabilities Combined strength of Ericsson Sony Ericsson systems and services handsets Ericsson Mobile Platforms core handset technology © Copyright Telefon AB LM Ericsson 2004. All rights reserved THIRD QUARTER

13. Slide 13: Q3 financial highlights

    Q3 financial highlights ƒ Orders booked SEK 29.0 (28.1) b. – Book-to-bill year to date 1.03 ƒ Sales SEK 31.8 (28.0) b. – Up 14% year to date ƒ Gross margin 47.1% (35.9%) – Continued solid performance Well positioned for profitable growth © Copyright Telefon AB LM Ericsson 2004. All rights reserved T

14. Slide 14: Q3 financial highlights (cont.)

    Q3 financial highlights (cont.) ƒ Income after financials SEK 7.0 (1.1) b. – Operating margin of 22.7% ƒ Cash flow bef. financing SEK 5.2 (9.1) b. – Cash flow from operations SEK 6.5 b. ƒ Debt free with net cash of SEK 37 b. – Strong financial position Well positioned for profitable growth © Copyrig

15. Slide 15: Sony Ericsson Q3 highlights

    Sony Ericsson Q3 highlights ƒ Continued growth – Units up 51%, sales up 29% year-on-year ƒ Income before tax EUR 136 m. – Maintaining momentum ƒ Product portfolio with leading edge – The first “real” digital camera phone © Copyright Telefon AB LM Ericsson 2004. All rights reserved THIRD QUARTER REPO

16. Slide 16: Market outlook 2004/2005

    Market outlook 2004/2005 ƒ 2004 global mobile systems market* – Catch up effect has started to abate ƒ 2005 global mobile systems market* – Slight market growth, 2004 catch up effect included – Moderate underlying market growth ƒ Good growth in professional services market* *All estimates are measur

17. Slide 17: Summary

    Summary ƒ Continued solid performance – Well positioned for profitable growth ƒ Expanding our role as vendor and partner – End-to-end capabilities in focus ƒ Continued cost efficiency – Ambition to deliver “best in class margins” © Copyright Telefon AB LM Ericsson 2004. All rights reserved THIRD QUA

18. Slide 18: Questions & Answers

    Third Quarter Report QUESTIONS & ANSWERS

19. Slide 19: Third Quarter Report 2004

    hird uarter eport 2004 ERICSSON &

20. Slide 20: Ericsson - Taking you forward

    ERICSSON & TAKING YOU FORWARD

Ericsson — Q3 2004 Earnings Presentation on 6ix