Ericsson reported mixed third-quarter 2025 results, with adjusted earnings beating estimates but revenues missing. The company’s top line was impacted by weakness in South East Asia, Oceania, and India. Focus on operational efficiency and cost optimization led to an improved gross margin. Net income was SEK 11.3 billion ($1.19 billion), with earnings per share at SEK 3.33 (35 cents).

Revenues for Ericsson were SEK 56.2 billion ($5.8 billion), down 9% year over year. The Networks segment generated SEK 35.4 billion ($3.72 billion), while Cloud Software and Services revenues increased to SEK 15.3 billion ($1.6 billion). The Enterprise segment saw revenues of SEK 5.1 billion ($536 million), with other revenues at SEK 0.4 billion ($42 million).

In terms of regional performance, South-East Asia, Oceania, and India’s revenues were down, while revenues from North East Asia decreased by 4% year over year. The Americas saw a 15% decline in net sales, while Europe, the Middle East, and Africa witnessed a 1% decline. Other regions saw an increase in revenues.

Ericsson generated SEK 7.9 billion ($830 million) in cash from operating activities during the quarter, with net cash of SEK 51.9 billion ($5.51 billion) as of Sept. 30, 2025. For the fourth quarter, the company expects revenues to be in line with seasonality averages, with a gross margin range of 49-51%.

Ericsson currently holds a Zacks Rank #3 (Hold). Other stocks to consider are Ubiquiti Inc. (UI) with a Zacks Rank #2 (Buy), Corning Incorporated (GLW) with a Zacks Rank #2, and Celestica (CLS) with a Zacks Rank #2. Ubiquiti, Corning, and Celestica all delivered positive earnings surprises in the last reported quarter.

Read more at Nasdaq: Ericsson Q3 Earnings Beat Estimates Despite Lower Revenues