STOCKHOLM, Sweden-L.M. Ericsson reported 1999 pretax profit dropped 10 percent to $1.89 billion, ahead of analysts’ expectations.
Sales for the fourth quarter increased 25 percent to $8.36 billion, with mobile systems as a primary contributor. For the year, sales totaled $24.4 billion, a 17-percent increase from 1998 sales. Mobile systems sales grew 41 percent for the year, said the company.
Meanwhile, Ericsson said its market share for mobile phones decreased during the year, although it expects an improved product offering combined with strong market demand for mobile phones in general to help it improve its market share. The company said during 1999, it introduced more new mobile phone models than ever before, several of which are Wireless Application Protocol-enabled devices, which will be delivered in volume this year.
“The first quarter of 1999 was exceptionally weak, affected by restructuring costs and slow development in China and for mobile phones,” said Lars Ramqvist, chairman and chief executive officer of the company. “For the first quarter of year 2000, we expect a sales growth by more than 30 percent and income before taxes in the range of three times that of the first quarter of 1999.”
Ericsson’s stock rose 11 percent on the Stockholm Stock Exchange to $72.64.
