YOU ARE AT:5GEuropean Investment Bank loans nearly $300 million to Ericsson for 5G R&D

European Investment Bank loans nearly $300 million to Ericsson for 5G R&D

Follows 5G R&D loans totaling $370 million from Nordic Investment Bank, AB Svensk Exportkredit

The European Investment Bank (EIB), a nonprofit lender backed by the European Union, is loaning Swedish network infrastructure giant Ericsson nearly $300 million to fund ongoing research and development related to 5G. In January, Ericsson also borrowed $220 million from the Nordic Investment Bank and $150 million from AB Svensk Exportkredit, a state-owned Swedish financier.

According to terms of the loan from the EIB, the $291.6 million credit facility will mature five years after disbursement. EIB VP Alexander Stubb, in a statement, pointed to how Ericsson’s work fits into larger European Union goals. “The development of 5G technology is easily one of the most important initiatives for the telecom industry in the coming years. Ericsson has been one of the defining contributors to what mobile telephony is today and I think we can only be proud to support this. Apart from supporting European technology, this project will also make sure that thousands of highly-skilled jobs will stay in the EU.”

According to the company, it spent around $4 billion on R&D in 2017.

In reporting its first quarter 2018 results in April, Ericsson officials tallied a 9% year-over-year decreased in sales with revenue decreases in Northeast Asia, Southeast Asia, Oceania and India. Specific to the networks business, Ericsson reported an improved operating margin of 13.5% “with strong gross margin and increased investments in R&D.”

In comments made at the time, CEO Börje Ekholm called R&D investment “a cornerstone in our strategy…for both technology leadership and cost leadership, which will allow us to generate higher gross margins. WE continue to increase our R&D investments in networks to lead in 5G.”





Sean Kinney, Editor in Chief
Sean Kinney, Editor in Chief
Sean focuses on multiple subject areas including 5G, Open RAN, hybrid cloud, edge computing, and Industry 4.0. He also hosts Arden Media's podcast Will 5G Change the World? Prior to his work at RCR, Sean studied journalism and literature at the University of Mississippi then spent six years based in Key West, Florida, working as a reporter for the Miami Herald Media Company. He currently lives in Fayetteville, Arkansas.

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