Ericsson slightly lags profit expectations as AI demand drives up chip costs

17 Apr 2026, 05:20 · CNA · Join

A logo of Ericsson is seen outside the company's office in Kanata, Ontario, Canada April 17, 2023. REUTERS/Lars Hagberg

Ericsson logo is displayed on the company's headquarters building in Stockholm, Sweden July 12, 2024. TT News Agency/Mikaela Landestrom via REUTERS

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April 17 : Sweden's Ericsson reported a first-quarter core profit that slightly missed market expectations on Friday, citing increasing chip costs caused by artificial intelligence demand and a sales slowdown in North America.

The company reported an adjusted operating profit of 5.2 billion Swedish crowns ($566 million), excluding restructuring charges, for the first quarter of 2026. Analysts polled by Infront were expecting 5.4 billion crowns on average.

Ericsson, one of the main Western suppliers of network equipment alongside Finland's Nokia, is betting heavily on the U.S. market even as transatlantic ties have become strained under President Donald Trump's rule.

The Swedish group has significant exposure to the United States, especially after winning a $14 billion deal with operator AT&T in 2023, which could help outweigh slower telecoms investments in other markets.

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"We are facing increasing input costs, especially in semiconductors, caused in part by AI demand," CEO Börje Ekholm said in a statement.

The company reported first-quarter net sales of 49.3 billion crowns, compared with an Infront poll estimate of 50.7 billion crowns.

($1 = 9.1869 Swedish crowns)

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