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Ericsson +3.9% after more modest industry outlook

Published 11/10/2016, 03:21 PM
Ericsson +3.9% after more modest industry outlook
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  • Ericsson (NASDAQ:ERIC) has gained 3.9% in U.S. trading after the company put out new expectations, an outlook that wasn't as bearish as analysts had feared.
  • "We have a tough market situation out there," said acting CEO Jan Frykhammar to investors, though he pointed to gaining momentum in the company's partnership with Cisco Systems (CSCO -0.7%).
  • Ericsson's been dogged by weaker industry demand for mobile broadband equipment, and shares have fallen 46.6% year-to-date on Nasdaq.
  • The company expects average annual growth in its products and services market areas of 1-3% from 2016 to 2018, down from last year's forecast of 2-4% market growth from 2014-2018. Negative trends from the first half are expected to prevail for at least two or three more quarters.
  • The Cisco team-up started slow but is gaining traction, Ericsson says, with more than 60 joint customers and several areas of collaboration ahead.
  • "We understand that we need to perform better but you also as investors need to give us some time," Frykhammar said.
  • Previously: Ericsson's new CEO builds stake (Oct. 28 2016)
  • Previously: New Ericsson chief: Reinvestment will drive top line (Oct. 26 2016)

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