December 12, 2017

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Ericsson: Restated Segment Financials Published and Impairment Testing Begins

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STOCKHOLM, Dec. 8, 2017 /PRNewswire/ —Restated segment financials

As announced in April 2017, Ericsson (NASDAQ: ERIC) will start to report financials according to its new segments as of the fourth quarter 2017. To facilitate year-on-year comparisons, Ericsson today discloses the restated financials for full year 2015, each quarter of 2016 and the three first quarters of 2017.

The four segments reported are:

Networks – Radio and transport solutions with supporting services, based on industry standards and offered via scalable modular platforms. The portfolio enables customers to evolve their telecom networks across generations to 5G – including new use cases, such as, public safety, IoT, and fixed wireless access.

Digital Services – Products and services providing solutions for our customers’ digital transformation journeys across the support systems BSS and OSS, Telecom Core, and IT Cloud domains through a combination of products, technology and expertise in networks, software, cloud, and business processes.

Managed Services – Services are offered in three main areas: Networks, IT, and Network Design & Optimization. Managed services for networks range from hands-on field service operations to remote network operations. IT managed services include the management of applications and data centers, while network design & optimization services evolve and expand customer networks to meet ever-changing demands from consumers and business users.

Other – Products and services that enable content owners, broadcasters, TV service providers and network operators to efficiently deliver, manage and monetize new TV experiences. In addition, segment Other includes iconectiv and emerging business such as Internet of Things and Unified Delivery Network (UDN).

Financial disclosures for each segment remain the same as earlier and include:

 Net Sales  Gross income and gross margin  Operating income and operating margin  EBITA and EBITA margin  Restructuring charges

Net Sales for segments Networks and Digital Services include a breakdown of sales into products, services and IPR licensing revenues. The split of IPR licensing revenues will be 82% to Networks and 18% to Digital Services.

There is no change in the geographical structure. Net sales will continue to be reported in five geographic Market Areas and Market Area Other.

Overview of restated financials:

Net sales SEK million

2017 Q1 – Q3

2016

2015

 

Networks

91,781

140,984

157,791

 

Digital Services

28,116

45,298

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