Ericsson saw profits jump for the second consecutive quarter as the company continued to predict that revenues would get a boost in the second half of the year.
Net profit increased by 76 percent year-on-year to €292 million between April and June as sales fell one percent to €5.9 billion.
The vendor’s Global Services business unit saw sales fall seven percent as network roll out contracts fell by a fifth.
Revenues in the company’s Networks division were up three percent, while Support Solutions grew by 21 percent, thanks to the impact of Mediaroom business, which it bought from Microsoft last year.
Gross margin increased from 32.4 percent to 36.4 percent driven by an increased share of mobile broadband capacity projects in “advanced” LTE markets.
Ericsson President and CEO Hans Vestberg said: “After a slow start of the year, we are executing on previously awarded 4G LTE contracts in mainland China and Taiwan. Furthermore, the investment climate in India is improving following the concluded spectrum auctions and government elections held in May.”
Political unrest in parts of the Middle East and Africa is impacting sales, according to the CEO, but not in Russia and the Ukraine.
“As previously stated and with current visibility, key contracts awarded will gradually impact sales and business mix in the second half of the year,” he added.
In particular, Vestberg said the company’s modems business will start generating sales by the end of this year as its M7450 LTE thin modem is incorporated into smartphones and data devices.
Ericsson also announced a new deal to “monitor and optimize” Etisalat Egypt’s network. For example, the vendor will provide its macro and small cell solutions to address the increase in mobile broadband traffic and elevate service performance.
In addition, Ericsson said it will help to move the operator from network-centric key performance indicators (KPIs) to user-centric key quality indicators (KQIs).
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