Ericsson (ERIC) Gears Up For Q3 Earnings: What's In Store?
Zacks Investment Research | Oct 15, 2019 08:44AM ET
Ericsson (BS:ERICAs) (NASDAQ:ERIC) is scheduled to report third-quarter 2019 results before the opening bell on Oct 17. In the last reported quarter, the company missed the Zacks Consensus Estimate for earnings by a penny. Ericsson delivered a trailing four-quarter average positive earnings surprise of 24.1% despite missing estimates twice.
The Swedish telecom equipment maker is likely to report lower revenues on a year-over-year basis in the to-be-reported quarter due to fierce competition. It competes in a highly price-sensitive market, which has major presence of rivals like Nokia (HE:NOKIA) and Huawei.
Factors to Influence Results
During the third quarter, Ericsson witnessed a strong momentum in its 5G business with new contracts and commercial launches as well as live networks. Ericsson is currently live with commercial 5G in 19 customer networks across 15 countries, spanning four continents. The company in concert with RCS & RDS (DIGI) — the Romanian business unit of Digi Communications N.V. — introduced Romania’s first 5G commercial service in the busiest areas of Bucharest.
In partnership with Vodafone Group (LON:VOD) Plc, Ericsson introduced Vodafone U.K.’s 5G service with unlimited data plans for consumers and business customers. The move emphasizes Ericsson’s sustained focus on working closely with communication service providers in a bid to drive 5G in Europe.
On Sep 25, 2019, Ericsson communicated that its third-quarter 2019 results will be impacted by a 12 billion Swedish krona provision. This is due to a possibility of unfavorable outcome of the ongoing investigations by U.S. authorities into its business ethics breaches in six countries — China, Djibouti, Indonesia, Kuwait, Saudi Arabia and Vietnam.
The Zacks Consensus Estimate for total revenues is pegged at $5,903 million. The company reported $6,418 million in the year-ago quarter. Consequently, adjusted earnings per share are pegged at 8 cents. Adjusted earnings reported a year ago were 12 cents.
What Our Model Says
Our proven model does not show that Ericsson is likely to beat earnings estimates this quarter as it does not possess one of the two key components. A stock needs to have both a positive Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.