Ericsson's growth hotspots are sometimes surprising. The usual suspects -- China, India, Japan -- are joined by GSM orders from Bangladesh and major network rollouts in sub-Saharan Africa. Russia is a dead spot right now, but only because the service providers there are hammering out their own GSM implementation plans. Brazilian and Mexican networks are looking at 3G equipment. And so it goes.
It boils down to an overall 8% annual revenue boost. Wider margins turn that into a 12% operating income gain, and you've already seen the bottom-line impact. A major driver of all this growth is a worldwide thirst for high-bandwidth mobile services.
Ericsson says that the average traffic on its monitored networks has doubled in the last six months. The trend should only continue as network providers such as America Movil
Luckily -- or smartly -- Ericsson's low-end infrastructure equipment is easily upgraded to 3G capabilities, providing a steady stream of incremental revenues as the Bangladeshis ask for more bandwidth.
Stateside, the current star customer is AT&T
Standard & Poor's upgraded Ericsson's credit rating a couple of notches last month, impressed by the mobile networker's "remarkably strong capital structure and liquidity." It expects the company to keep growing at least as fast as the global cell phone industry itself for the foreseeable future. That's a nice vote of confidence from a seasoned observer, don't you think?
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Fool contributor Anders Bylund holds no position in any of the companies discussed here, and he doesn't own a cell phone. You can check out Anders' holdings if you like. Foolish disclosure is always there for you, wherever you may go.