The 10-second takeaway
For the quarter ended March 31 (Q1), Ericsson missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share grew significantly.
Margins grew across the board.
Ericsson booked revenue of $7.69 billion. The 26 analysts polled by S&P Capital IQ anticipated revenue of $7.96 billion on the same basis. GAAP reported sales were 7.9% lower than the prior-year quarter's $8.35 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.42. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.13 per share. GAAP EPS of $0.42 for Q1 were 110% higher than the prior-year quarter's $0.20 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 100.0%, 6,120 basis points better than the prior-year quarter. Operating margin was 17.8%, 520 basis points better than the prior-year quarter. Net margin was 17.3%, 960 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $8.38 billion. On the bottom line, the average EPS estimate is $0.09.
Next year's average estimate for revenue is $34.21 billion. The average EPS estimate is $0.61.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 342 members out of 372 rating the stock outperform, and 30 members rating it underperform. Among 90 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 85 give Ericsson a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Ericsson is outperform, with an average price target of $11.17.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.