Ericsson's business model is built on providing end-to-end network solutions to telecom operators.
The company has a strong focus on innovation, with a significant portion of its revenue coming from 5G-related sales.
Ericsson's growth in the 5G era is driven by its ability to deliver cutting-edge technology and solutions to its customers.
The company's 5G offerings include radio access, core, and transport solutions, as well as services and consulting.
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Leadership and Strategy
Ericsson's leadership changes are a strategic move to balance technical expertise with customer-centric execution. Per Narvinger, a 28-year veteran, has been elevated to Head of Business Area Networks, a role critical to maintaining Ericsson's edge in high-performance and programmable infrastructure.
Narvinger's prior success in Cloud Software and Services demonstrates his ability to harmonize innovation with profitability, achieving a 9.6% EBITA margin in Q2 2025. His appointment ensures continuity through his deep technical acumen, following Fredrik Jejdling's departure after leading the Networks business since 2017.
Ericsson's regional operations have been reorganized into two streamlined market areas: Americas (led by Yossi Cohen) and Europe, Middle East & Africa (led by Patrick Johansson). This structure aims to reduce redundancies while maintaining localized responsiveness, particularly vital for 5G deployment where regional customization and rapid deployment are critical.
Ericsson's leadership transition is not merely cost-cutting exercises, but a calculated pivot toward 5G and enterprise leadership. The company is building a foundation for sustained value creation by appointing executives with deep technical and market expertise, streamlining operations, and investing in AI and Open RAN.
Ericsson's future plans include making 5G the worldwide standard for the upcoming generation of wireless tech, working with several mobile operators to achieve this goal.
Leadership Shifts for 5G and Enterprise Growth
Ericsson's leadership team has undergone significant changes to drive growth in the 5G and enterprise markets. Per Narvinger, a 28-year veteran, has been appointed as the Head of Business Area Networks, a role critical to maintaining Ericsson's edge in high-performance and programmable infrastructure.
Narvinger's prior success in Cloud Software and Services, where he drove a 9.6% EBITA margin in Q2 2025, demonstrates his ability to balance innovation with profitability. His appointment follows Fredrik Jejdling, who led the Networks business since 2017 and oversaw its transformation into a leader in energy-efficient RAN solutions.
The leadership reshuffle also sees Jenny Lindqvist take the helm of Cloud Software and Services, a division central to Ericsson's enterprise ambitions. Lindqvist's background in Europe and Latin America positions her to scale Ericsson's Private 5G platform, a key differentiator in manufacturing, logistics, and healthcare.
Ericsson's regional operations have been reorganized into two streamlined market areas: Americas (led by Yossi Cohen) and Europe, Middle East & Africa (led by Patrick Johansson). This move aims to reduce redundancies while maintaining localized responsiveness, particularly vital for 5G deployment.
Here are some key takeaways from Ericsson's leadership changes:
Acquisitions
Ericsson's acquisition strategy has been a key factor in their growth and success. They have acquired 39 organizations, with their most recent acquisition being Vonage for $6.2 billion on July 21, 2022.
Vonage offers business communication solutions that can easily upgrade customer and employee services. This acquisition aligns with Ericsson's goal of providing innovative solutions to their customers.
Here's a list of some of Ericsson's notable acquisitions:
Ericsson's acquisitions have helped them expand their offerings and improve their services. By acquiring companies like Cradlepoint and Envivio, they have been able to provide more comprehensive solutions to their customers.
Competitors
In the competitive world of telecommunications, Ericsson faces stiff competition from several major players.
Ericsson's top competitors include Amdocs, Infosys, Cisco, ZTE, Huawei, and Nokia companies.
These companies are all industry leaders, with significant market share and resources at their disposal.
Ericsson's revenue dropped 2 percent to SEK 49.8 billion in Q1 2020, a decrease from SEK 48.9 billion in Q1 2019.
The Covid-19 pandemic had a limited impact on Ericsson's operating income and cash flow in the quarter.
Gross margin excluding restructuring charges improved to 40.4 percent, up from 38.5 percent in the previous quarter.
Challenges Faced
In 2019, Ericsson agreed to pay over $1.2 billion to settle US investigations into foreign corruption.
The company admitted to paying bribes, which is a serious breach of trust with customers and partners.
Ericsson's actions were not isolated to one region, but rather a campaign of corruption that spanned multiple countries including China, Indonesia, Vietnam, Kuwait, and Djibouti.
The company's failure to implement reasonable internal accounting controls allowed this corruption to go unchecked for over a decade.
Falsifying books and records is a clear sign of a lack of transparency and accountability, which can have severe consequences for a company's reputation.
Ericsson's actions demonstrate the importance of implementing strong internal controls to prevent corruption and ensure compliance with regulations.
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Financial Performance
Ericsson's financial performance is a testament to its operational efficiency. The company reported a 48% adjusted gross margin and a 13.2% EBITA margin in its Q2 2025 financial results, outperforming the industry average.
These figures are a direct result of Ericsson's cost discipline and favorable product mix. The company's ability to balance R&D investments with profitability is a key driver of its success.
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Ericsson's restructuring efforts have also paid off, with a 6% workforce cut of 6,000 employees without sacrificing organic growth. This shows the company's operational rigor and commitment to efficiency.
In terms of revenue, Ericsson's Q1 2022 results showed a 3% increase to SEK 55.1 billion, driven by growth in the network business. This is a significant improvement from previous years.
Here's a look at Ericsson's revenue growth over the past few years:
Overall, Ericsson's financial performance is a strong indication of its ability to adapt and thrive in a rapidly changing market.
5G Enterprise
Ericsson's 5G enterprise ambitions are driven by its commitment to customer-centric execution. The company's leadership reshuffle has elevated Per Narvinger to Head of Business Area Networks, a role critical to maintaining Ericsson's edge in high-performance and programmable infrastructure.
Ericsson's Private 5G platform is a key differentiator in manufacturing, logistics, and healthcare. Jenny Lindqvist, who takes the helm of Cloud Software and Services, has experience navigating complex regulatory landscapes in Europe and Latin America.
The enterprise market is a growth engine for Ericsson, with 90% of businesses seeing AI as a security enhancer. This demand is driving the adoption of Ericsson's dual-mode 5G Core solution, which powers 42 of the world's 70+ live 5G SA networks.
Ericsson's on-Demand platform, a core network-as-a-service platform in partnership with Google Cloud, offers SaaS-based connectivity and diversifies revenue streams. This strategic pivot toward 5G and enterprise leadership is building a foundation for sustained value creation.
Ericsson's focus on agility is reflected in its reorganization of regional operations into two streamlined market areas. This structure is particularly vital for 5G deployment, where regional customization and rapid deployment are critical to capturing market share.
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Business Model and Growth
Ericsson's business model is diverse and comprehensive. It offers a range of products and solutions for mobile and fixed communication, including radio networks, core networks, and cloud services.
The company's Global Services division provides network rollout services and professional services, such as managed services, customer support, and consulting. Ericsson's Support Solutions division, on the other hand, offers software-based solutions for BSS and OSS, TV and media solutions, and services for the mobile commerce ecosystem.
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Ericsson's revenue has been steadily increasing over the years, with a 3% increase in Q1 2022 to SEK 55.1 billion, driven by growth in the network business. Here's a breakdown of the company's revenue growth over the past few years:
This growth is expected to continue, with the 5G Enterprise Market projected to grow at a 32.5% CAGR through 2033.
Funding and Investors
Ericsson has secured significant funding to support its growth. Ericsson has received a €250M post-IPO debt funding from the European Investment Bank in June 2018.
The company also received a $370M post-IPO equity funding from Nordic Investment Bank and Svensk Exportkredit in December 2017. This investment highlights the confidence of investors in Ericsson's business model.
Ericsson has also partnered with Cevian Capital, a prominent investment firm, which led a post-IPO equity funding round in May 2017.
Business Model
Ericsson's business model is quite diverse, with three main areas of focus.
The company's Networks division provides a wide range of products and solutions for mobile and fixed communication, including radio networks, core networks, and cloud services.
Ericsson's Global Services division offers network rollout services and professional services, specifically managed services, customer support, consulting and systems integration (CSI), and network design and optimization services.
In addition to these two main divisions, Ericsson's Support Solutions division provides software-based solutions for BSS and OSS, TV and media solutions, and services/solutions for the mobile commerce ecosystem.
Ericsson's business model is designed to cater to various needs of its customers, from network infrastructure to professional services and software solutions.
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Frequently Asked Questions
Where is the Ericsson headquarters?
Our headquarters are located in Stockholm, Sweden, a base we've maintained for 140 years.
Do they still make Ericsson phones?
Ericsson no longer produces mobile phones under its own brand, as its mobile phone division was merged with Sony in 2001 to form Sony Ericsson. However, Ericsson continues to be a leading provider of mobile network infrastructure and technology.
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