Ericsson (ERIC) Stock: Telecoms Giant Crushes Q4 Estimates, Launches First Buyback

TLDR

• Ericsson reported Q4 2025 adjusted operating profit of 12.26 billion crowns, beating analyst estimates of 10.09 billion crowns
• The company announced its first-ever share buyback program worth $1.7 billion, set to run from Q1 2026 through 2027
• Fourth quarter net sales reached 69.3 billion crowns, exceeding the 66.6 billion crown forecast
• Annual dividend increased to 3 crowns per share from 2.85 crowns previously
• Ericsson plans to cut 1,600 jobs in Sweden as part of ongoing restructuring efforts

---

Ericsson posted fourth quarter earnings that blew past Wall Street expectations on Friday. The Swedish telecoms equipment maker reported adjusted operating profit of 12.26 billion crowns for the final three months of 2025.

That figure crushed the analyst consensus of 10.09 billion crowns. The earnings beat came as the company continues aggressive cost-cutting measures across its operations.

The company surprised investors with another announcement. Ericsson will return 15 billion Swedish crowns, roughly $1.7 billion, to shareholders through its first-ever buyback program.

Telefonaktiebolaget LM Ericsson (publ), ERIC

The repurchase plan will kick off after first quarter 2026 results come out. It will continue through 2027, giving shareholders a new way to see returns beyond dividends.

Speaking of dividends, those got a bump too. The annual payout rises to 3 crowns per share from 2.85 crowns last year.

Revenue also topped forecasts for the quarter. Net sales hit 69.3 billion crowns against expectations of 66.6 billion crowns.

Strong Regional Performance Drives Results

Growth came primarily from Europe, the Middle East, and Africa. North American sales held steady during the period.

The cash position looks much healthier these days. Cost reductions helped, but so did the sale of Ericsson’s U.S.-based Iconectiv business.

That improved cash flow made the buyback possible. The company clearly feels confident enough in its financial position to return cash to investors.

Ericsson operates as one of only two Western suppliers of network equipment. Nokia is the other major player in this space.

Both companies have been dealing with weaker 5G investment trends. Ericsson responded by launching a deep restructuring program to maintain profitability.

Job Cuts Continue as Efficiency Push Accelerates

The restructuring includes workforce reductions. Earlier this month, Ericsson announced plans to eliminate 1,600 jobs in Sweden.

The cuts aim to boost operational efficiency. The company also moved quickly last year to adjust its operations around U.S. import tariffs.

Finance chief Lars Sandström addressed potential market share changes in a Reuters interview. He discussed European Commission proposals to phase out high-risk suppliers in critical sectors.

Those proposals could benefit Ericsson and Nokia in European markets. However, Sandström said it’s too early to quantify the potential impact.

The fourth quarter results show Ericsson’s restructuring efforts are paying off. The company beat expectations on both the top and bottom lines while maintaining stable operations in North America.

The buyback program represents a vote of confidence from management. It signals they believe the worst of the 5G investment slowdown may be behind them.

The post Ericsson (ERIC) Stock: Telecoms Giant Crushes Q4 Estimates, Launches First Buyback appeared first on CoinCentral.