Ericsson Increases Forecast For 5G Subscriptions By 2024
Zacks Investment Research | Jun 10, 2019 10:09PM ET
Ericsson (BS:ERICAs) (NASDAQ:ERIC) , in its June 2019 Mobility Report, has projected an additional 400 million enhanced mobile broadband subscriptions worldwide by the end of 2024 on the back of quick initial momentum and gusto for fifth-generation cellular network technology.
The Swedish telecom equipment vendor’s latest report estimates 1.9 billion 5G subscriptions, up from 1.5 billion anticipated in the November 2018 report, marking a surge of almost 27%. Communication service providers in several markets have switched on 5G, following the launch of 5G-compatible smartphones.
Markedly, other estimates have also increased, driven by the rapid uptake of 5G technology. 5G coverage is expected to reach 45% of the world’s population by end of 2024. This could go up to 65%, as spectrum sharing technology enables 5G deployments on LTE frequency bands.
Ericsson, being one of the premier telecom services providers, is much in demand among operators to expand network coverage and upgrade networks for higher speed and capacity. It is the world’s largest supplier of LTE technology with a significant market share and has established a large number of LTE networks worldwide.
Ericsson is focusing on 5G system development and has undertaken many notable endeavors to position itself for market leadership. The rise in 5G subscriptions is expected to be fastest in North America with 63% of expected mobile subscriptions within the next five years, followed by North East Asia with 47% and Europe with 40%. 5G will likely have positive impact on consumers’ lives.
Moreover, strong commitment of chipset and device suppliers is the key to the acceleration of 5G adoption. Smartphones for all main spectrum bands are scheduled to hit the market this year. As 5G devices increasingly become available and more 5G networks go live, more than 10 million 5G subscriptions are estimated globally by the end of 2019. Ericsson has been working with operators to help in their network transformation, while optimizing on plenty of growth opportunities.
Such positive industry trends are expected to boost the company’s long-term growth. Ericsson plans to accelerate its planned cost cuts and efficiency measures, and focus on its core business of selling networking equipment with the expected roll-out of 5G networks.
The company continues to execute its strategy and is on track to achieve its 2020 financial targets. It is investing in its competitive 5G-ready portfolio to enable seamless migration to 5G technology. The company’s R&D investments over the past two years have secured a competitive and industry-leading offering.
Driven by proper execution of operational objectives, shares of Ericsson have rallied 35% compared with the Original post
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