Ericsson sees Q1 profits down, hit by poor broadband demand in US, while global sales grow

MarketsAssociated Press

Wireless equipment maker Ericsson says it was hit by sluggish broadband demand in North America, with first-quarter net profit falling 14 percent to 1.5 billion kronor ($ 173 million), while global sales grew.

The Swedish company's revenue increased 13 percent to 53.5 billion kronor ($6.2 billion) in the period, driven by strong demand in India and North East Asia.

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CEO Hans Vestberg says Ericsson will continue "to proactively identify efficiency opportunities," and announced 850 new job cuts in Sweden, bringing the total to more than 3,000. He said a 9-billion-kronor savings program would be fully implemented by 2017.

Ericsson said Thursday that despite low broadband growth, consumer demand and mobile data traffic growth continues to be strong in North America, with "further need for quality and capacity investments."