16 slides from Telefonaktiebolaget Lm Ericsson Class A's earnings presentation, Oct 20, 2022
Slide 1: Ericsson Third quarter 2022
Ericsson Third quarter 2022 Oct 20, 2022 © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
Slide 2: Third quarter 2022
Third quarter 2022 This presentation contains forward-looking statements. Such statements are based on our current expectations and are subject to risks and uncertainties that could materially affect our business and results. Please read our earnings reports and our most recent annual report for a b
Slide 3: Business overview
Business overview Börje Ekholm President and CEO © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
Slide 4: Q3 in brief
Q3 in brief ●Robust underlying performance and strong momentum with global footprint gains Organic sales: ●Gross income improved by SEK 3.4 b. to SEK 28.1 b. driven by sales growth in Networks and Enterprise 3% ●Gross margin impacted by lower IPR, supply chain costs and larger share of services ●New
Slide 5: Financial overview
Financial overview Carl Mellander Chief Financial Officer © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
Slide 6: Q3 2022 in numbers
Q3 2022 in numbers Financial Performance Excluding restructuring charges ● Organic and FX adjusted: +3% YoY SEK b. 22Q3 21Q3 YoY 22Q2 – Primarily Networks in North America Net sales 68.0 56.3 21% 62.5 – IPR revenues SEK 1.6 (2.6) b. Organic and FX adj. sales 3% – Enterprise: +21% YoY – Cradlepoint &
Slide 7: Segment summary
Segment summary Excluding restructuring charges Mobile Infrastructure Enterprise Networks Cloud Software and Services Enterprise SEK b. 22Q3 21Q3 YoY 22Q2 SEK b. 22Q3 21Q3 YoY 22Q2 SEK b. 22Q3 21Q3 YoY 22Q2 Net sales 48.1 40.6 19% 46.0 Net sales 14.2 13.6 4% 14.0 Net sales 5.2 1.6 231% 1.9 Gross Inc
Slide 8: Market update Q3 – Growth in three market areas
Market update Q3 – Growth in three market areas 39% 9% 22% 0% 8% -6% 8% 3% Market area ”Other” Share of Group sales 12% 13% 10% N/A Organic sales growth © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022 This slide contains forward-looking statements. Actual result may be materially
Slide 9: Free cash flow and financial position
Free cash flow and financial position Financial Performance SEK b. Q322 Q321 ● Free cash flow before M&A of SEK 2.5 (13.0) b. EBIT excluding restructuring charges 7.2 8.8 ● Impact from change in operating net assets was Depreciation, amortization & impairment losses 2.6 2.4 SEK -3.3 (4.9) b. Restruc
Slide 10: Vonage transaction
Vonage transaction Purchase price paid on acquisition1 ● Purchase price paid on acquisition: SEK -51.3 b. Bridge USD b. SEK b. – Support from USD/SEK hedge by SEK 3.7 b. Enterprise value 6.3 64.1 Net debt (including FTC provision) N/A 7.1 ● Repayment of long-term debt related to Vonage: SEK -5.9 b.
Slide 11: Outlook
Outlook Group: – IPR Sales ● With current contracts, revenues from IPR are estimated to be SEK 1.0–1.5 b. in Q4 – Operating expenses ● Q3→Q4: Average seasonality last 3 years (2019–2021) excluding Vonage: Increase of SEK -3.1 b. Networks: – Sales: ● North America: RAN capex levels are expected to ho
Slide 12: Summary
Summary ●5G global build-out continues – expect a longer investment cycle ●Continued investments to drive technology leadership ●Expansion into Enterprise gains speed ●Strengthening cost competitiveness ●Continued success from Networks portfolio ●Lower sales in North America compensated by other reg
Slide 13: © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
© Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
Slide 14: Closing remarks
Closing remarks Börje Ekholm President and CEO © Telefonaktiebolaget LM Ericsson 2022 | Third quarter report 2022
Slide 15: W
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Slide 16: Forward-looking statements
Forward-looking statements This presentation includes forward-looking statements, including statements reflecting management’s current views relating to the growth of the market, future market conditions, future events, financial condition, and expected operational and financial performance, includi