Displaying items by tag: sales
Ericsson published its financial results for Q3 2019, reporting 3% percent growth in sales. Total sales were SEK 57.1 billion(b)., equivalent to AED 21.5 b. Sales adjusted for comparable units and currency increased by 3% driven by strong growth in North America and North East Asia.
For Q3 19, operating income was impacted by cost provisions of USD -1.2 b. (SEK -11.5 b.) corresponding to a margin of 11.4% excluding restructuring costs, the US investigation costs of USD -1.2 b. (SEK -11.5 b.) and the refund of social security costs of SEK 0.9 b.
Ericsson previously communicated that its third-quarter 2019 results will be impacted by a 12 billion Swedish krona provision. This is due to the investigations by U.S. authorities.
Net income suffered a SEK -6.9 b. loss, also negatively impacted by the investigation.
Free cash flow before M&A was SEK 5.5 b., showing a strong financial position.
Gross margin excluding restructuring charges was 37.8% (36.9%) with improvements in Managed Services, Digital Services and Networks. The gross margin in the previous quarter was 36.7% and 36.9% last year.
Strategic contracts in Networks, with initially low margins, taken to strengthen the market position, are expected to have a somewhat increased negative impact on gross margin short term without jeopardizing the 2020 target.
Ericsson has played a pivotal role in the advancement of 5G technology. Large 5G deployments in China are expected to commence in 2020. Ericsson has invested in R&D and supply chain capacity, aiming to increase market share. Based on historic experience margins are initially challenging but turn positive over the lifespan of a contract.
Commenting on the results, to Börje Ekholm, President and CEO of Ericsson said:
“We continue to see strong momentum in our business, based on the strategy to increase our investments for technology leadership, including 5G… Our focused strategy, introduced in 2017, is aimed at building a stronger Ericsson longer term. With clear focus on our operator customers the strategy stands on a foundation of increased investments in R&D for technology and cost leadership, and growing market footprint. Increased R&D efforts, which will continue, have resulted in a competitive portfolio driving improved gross margin.”
He added, “An important indicator for our execution of the strategy is the improvement in gross margin. The gross margin in the quarter ended at 37.8% compared with 36.9% last year and 36.7% last quarter. Within the 0.8 percentage point sequential decline in Networks gross margin, we have absorbed the margin impact and inventory provisions related to strategic contracts.”
In the report, Börje Ekholm believes their success is driven by the adopters of 5G. He also announced that 5G has taken off earlier than expected.
“5G is taking off faster than earlier anticipated and we see initial 5G buildout as a capacity enhancer in metropolitan areas. However, over time, new exciting innovations for 5G will come with industrial and IoT use cases, leveraging the speed, latency and security characteristics of 5G. This provides opportunities for our customers to capture new revenues as they provide additional benefits to consumers and businesses.”
“Our IoT business is growing almost twice as fast as the estimated market growth of 20-25% per year. We have more than 4,500 enterprises on our IoT platform and the number of connected devices on the platform has more than doubled year to date. To fully leverage our position and capture new recurring revenue streams we are increasing our investments in IoT within Emerging Business. With this investment, we do not expect to reach breakeven for the segment next year, and instead incur losses of SEK -1.5 to -2.0 b”
Ericsson has reported its first quarter results which reflect an increase driven by the growth the Swedish vendor has registered in North America.
Swedish telecom vendor Ericsson has surprised analysts with reduced losses in Q4 driven by the increase of sales revenues and costs reduction. Sales as reported increased by 10% Year-on-Year and sales adjusted for comparable units and currency increased by 4%. Costs related to revised Business Support Systems (BSS) strategy impacted Digital Services operating income in Q4.
US technology giant Apple has announced that it will impose a recruitment cutback - which has been primarily forced due to weak sales on the company’s iPhone devices in the lucrative Chinese market.
Bloomberg has reported that Apple CEO, Tim Cook, announced the recruitment cutbacks just a day after he sent a letter to Apple investors that warned the company was bracing itself for a year-on-year decline in revenue for its fiscal Q1, which would shave $5bn from its guidance.
In a series of meetings that were held following the disclosure, it was reported that Cook informed some staff that a number of divisions would reduce hiring, but stated that he didn’t think a complete freeze in recruitment would be an appropriate solution to take.
In addition to this, it has been further disclosed that the CEO is also yet to determine which divisions will face hiring cutbacks. However, it is believed that divisions such as Apple’s AI team will not be affected due to the leverage of investment made by the US tech company into the emerging technology.
The move will also not affect plans to open a state-of-the-art new office in Austin, Texas or its expansion plans in Los Angeles, where the company is fleshing out its original video content ambitions.
Bloomberg also pointed out that Apple has hired new staff at a significant rate over the past decade. The company recruited 9,000 workers in its most recent fiscal year, taking the total up to 132,000, while adding 7,000 a year earlier.
US technology behemoth Apple has signed a new agreement with Samsung in relation to its streaming and content services in an effort to offset a decline in iPhone sales. The deal brokered between Apple and the South Korean conglomerate will enable the use of iTunes streaming services on Samsung smart TVs.
Leading smartphone e-brand HONOR, recorded an impressive sales performance on Black Friday weekend and Cyber Monday in Europe, Middle East and USA. HONOR products dominated Amazon best seller lists in France, Germany, Italy and UK, with this year’s figures revealing a remarkable 250% YoY sales increase from 2017 across pan-European regions and sales in Spain reaching an impressive 300%.
HONOR smartphones’ popularity with shoppers demonstrates HONOR's continued growth and the increasing demand for its AI-Powered models. The HONOR 9 Lite was the No.1 online best-selling smartphone in the EUR150-EUR200 category, while the HONOR 10 - with its industry-leading AI-powered dual camera - ranked highly on the Amazon Top 10 list for Black Friday weekend sales. The new handset, HONOR 8X, was the best new release on Amazon Germany, and was the Best Seller in France smartphone online sales since the global launch in October. In Russia, the HONOR 8X is now the top selling smartphone online, and it has surpassed the sales of its predecessor, the HONOR 7X, with an increase of 500%.
During a Black Friday Promotion in the USA, the HONOR View 10 sold out on Amazon and Newegg, and saw remarkable sales growth over the weekend in the Middle East. Over Black Friday Weekend, HONOR ranked No.1 in the phone category on all sales channels in Finland, while Czech Republic saw overall HONOR smartphone growth reach 200% compared to 2017, with a 300% YoY increase for the HONOR 10. In Poland, the HONOR Play recorded 500% sales growth during Black Friday weekend, completely selling out on Euronet, X-kom and Media Expert within two hours, reaching an overall 150% sales growth.
"I'm pleased and grateful for the support we have received from consumers during this year's Black Friday sales. This latest sales surge tops a successful year for the HONOR brand, and we look forward to another fast-growing year in 2019,” said George Zhao, President of HONOR.
“With continued efforts in innovative technology and cutting-edge product design, we will continue to provide the best smartphones with the ultimate user experience to all consumers around the world."
South Korean conglomerate Samsung is on course for a record Q2 with its success being attributed to its flagship smartphone - the Galaxy S8. In addition to this, Samsung’s operating profit has also been boosted by its strong component sales.
It’s welcome news for Samsung and its stakeholders - after the much publicized disaster it ensued with the Galaxy Note 7 recall last year, which cost the organization millions. However, it has responded well, and the success of its new smartphone device is propelling that comeback.
A spokesman for Samsung indicated that the company expects to report an operating profit of around KRW14 trillion ($12.1 billion), compared with a figure of KRW8.14 trillion from the same period last year. The Wall Street Journal has reported that the figures released by the South Korean smartphone manufacturer is likely to result in Samsung edging out Apple to become the most profitable technology company during that period.
Analysts have suggested that from a smartphone perspective, both Apple and Samsung at very different junctures in their respective roadmaps, with Samsung developing a new flagship model, while Apple’s iPhone is mid-cycle. However, it has been claimed that Samsung invested heavily in what was an aggressive marketing campaign, and that is expected to have an impact on smartphone profitability.
Other industry commentators have attributed Samsung’s roaring success in Q2 down to strong memory chip prices. Reuters has reported that demand will outstrip supply for these products for the rest of 2017, which boost margins for suppliers. Samsung is also expected to supply OLED screens to Apple for its next-generation iPhones later this year. In addition to this, its own Galaxy S8 is expected to continue to boost smartphone sales.
In addition to overtaking Apple as the most profitable technology company, some analysts have suggested Samsung’s semiconductor sales are on course to outstrip those of Intel in Q2. In recent months Samsung announced a huge investment in its components business, which has also been a key driver for profitability.
Samsung will provide a detailed breakdown of its performance when it releases its Q2 results later this month.
US chipmaker Qualcomm has reignited its ongoing dispute with Apple following its decision to call on the US International Trade Commission (ITC) to ban the sale of certain iPhones. Qualcomm is calling for the prohibition of sales on the devices because it alleges that Apple has infringed up to six of its patents.
Qualcomm issued a direct and blunt statement in which it claims Apple had ‘engaged in the unlawful importation and sales’ of some iPhones – and confirmed that it is currently in the process of filing an official complaint with the ITC. Qualcomm which unveiled its Snapdragon 835 processor at CES 2017 in January, has argued that the patents in question involve ‘key technologies’ that enable important features and functions in iPhones, which includes the capacity to prolong battery life and overall efficiency of the devices.
Qualcomm has urged ITC to begin an investigation into Apple’s conduct, infringing imports and that they issue a Limited Exclusion Order (LEO) to bar importation of the devices into the US. It stressed that the ITC must stop Apple’s unlawful and unfair use of Qualcomm’s technology. This row is the latest in a long-running feud between the two technology titans, and Qualcomm added that it’s also seeking an LEO against iPhones that used cellular baseband processors other than those supplied by Qualcomm affiliates.
Analysts have suggested Qualcomm are talking about Intel indirectly, although they never name Intel in its official statement. But it is widely known that Intel began supplying chips to some iPhone 7 devices in September 2016.
Through a Cease and Desist order, Qualcomm is also attempting to block the sale of devices already in the US it believes infringe on its patents. Apple’s iPhones are assembled in Asia. Don Rosenberg, EVP and general counsel at Qualcomm said: “Apple continues to use Qualcomm’s technology while refusing to pay for it. These lawsuits seek to stop Apple’s infringement of six of our patented technologies.”
The row began in January when Apple sued Qualcomm alleging them of being guilty of overcharging them for chips, and refused to pay $1 billion in rebates. Qualcomm hit back in a counterclaim against Apple for breaching agreements and a number of other allegations.
Qualcomm then subsequently initiated legal proceedings against four Apple iPhone manufacturers for failing to pay royalties and breaching licensing agreements, before Apple launched a legal attack on Qualcomm’s business at the start of this month. Despite Qualcomm’s latest onslaught, the short-term impact on Apple is expected to be limited. Qualcomm has indicated that it expects the ITC to begin an investigation in August, but the case will not be tried until next year.
Chinese smartphone maker Xiaomi has unveiled its newest flagship smartphone – and the organization is confident the device can have a positive impact in the saturated smartphone industry. Xiaomi CEO conceded that the company had suffered a significant sales slump last year, and that it was going through somewhat of a ‘transitional period’.
However, that pessimism has been replaced with optimism with the launch of the ‘Mi 6’ smartphone. Management at Xiaomi believe the new device can serve as a catalyst that will see them make up for lost ground on rivals, after a disappointing 2016. The Chinese conglomerate launched the ‘Mi 6’ at an event in Beijing, having shelved plans to launch it at MWC in Barcelona, earlier this year.
Well what is so different about this product that has Xiaomi representatives believing it will provide a pathway back to challenge the titans of the smartphone sector? The first striking feature is the similarity to that of the iPhone 7, but the price isn’t one of them. The entry model — featuring 64 GB of storage — comes in at 2499 RMB, that’s around $360, with a 128 GB option (2899 RMB, $420) and ceramic edition (2999 RMB, $435) completing the range. All three are far cheaper than iPhone equivalents, but, interestingly for Xiaomi, the range is more expensive than the company’s usual flagship prices.
Another quite obvious iPhone comparison that stands out is that there is no headphone jack on Xiaomi’s new device, just as Apple elected to do with last year’s iPhone 7. The Chinese firm has seemingly followed that trend, or is doing what makes sense for itself in this instance, that is already ammo for Xiaomi skeptics.
With the Mi 6, Xiaomi has bumped up its RAM to 6GB, the most it has ever offered in a smartphone. The device is powered by a Snapdragon 835 10nm processor with a 64-bit, octa-core CPU with a whopping 3350 mAh battery that the company said will last a day thanks to “optimization” controls built into its MIUI operating system.
The device will go on sale from a number of selected stores in China in the next few days, expansion into international markets carefully selected by executives will commence at a later date, Xiaomi declined to provide a specific date it plans to initiate this launch. Xiaomi suffered a huge blow when the dynamic face of the organization, Hugo Barra decided to quit the company to lead Facebook’s VR department.
Xiaomi revealed it cleared $1 billion in revenue in India, its second largest market behind China, last year, while Lei Jun added that it ranks second in the country, but nothing has been said of its performance in the other 20-odd countries where its phones are sold.
Chinese smartphone maker Huawei has gained significant ground on industry giants Apple and Samsung following a report issued by consultancy group Gartner. Samsung’s high-profile debacle with its Galaxy Note 7 impacted negatively on the organizations market share and that allowed Huawei to catch-up with their South Korean rivals.
Huawei has enjoyed a huge growth in sales, the Chinese company seen its sales increase by a whopping 26.7%, while both Samsung and US colossus Apple seen both their sales decline by 4.3%. This has enabled Huawei to increase its share in the smartphone market to 8.9% which is a rise of 7.3% from the previous twelve months.
In contrast to this Samsung seen its market share shrink by almost 2% to 20.5% - while Apple’s reduced to 14.4% from 15.9% - analysts have suggested that the results now clearly indicate that Huawei now appear to be the biggest challenger to both Samsung and Apple.
Gartner analyst, Annette Zimmermann said the results showed a huge progression for Huawei compared to other years. She said, “Chinese makers succeeded in winning market share over last year and Huawei now seems to be the main rival to the two giants, even if the gap remains large. We're seeing a very real progression compared with earlier years, when the number three maker and the others had struggled to hold on to a market share of more than four percent.”
Huawei results are all the more impressive when you consider the competitive nature of the smartphone industry in China alone, Huawei faces competition from other Chinese smartphone makers such as OPPO, BBK Communication Equipment (with its One Plus and Vivo brands), ZTE, Xiaomi and Lenovo.
In the fourth quarter of 2016 alone, Apple’s launch of its iPhone7 enabled it to take top slot in market share pushing Samsung off the top in the process. The South Korean firm where forced to recall of its Note 7 units. Samsung sold 76.8 million smartphones from October –December which gave it a global market share of 17.8% - while Apple edged them out narrowly with a 17.9% share in the market. Huawei had an overall market share of 9.5% after selling 40.8 million phones.
Zimmerman added, "Huawei looks likely to strengthen its position again this year. Preliminary data for the current quarter suggest that Samsung will overtake Apple again. But it's remarkable that Apple can hold on to that sort of share of the market with a closed eco-system.”
With regard to the different operating systems, Android, which is used by the large majority of smartphone makers, commands a market share of 81.7 percent, while Apple's iOS operating system of its iPhones and iPads accounts for 17.9 percent of the market.