Telefonaktiebolaget L M Ericsson ADR (ERIC)

Shares of Telefonaktiebolaget Lm Ericsson (ERIC) dropped by 2.94% from $4.76 to $4.62 in the trading on Tuesday, October 17, 2023. The reason why ERIC stock down include:

• Down-beat Q3 sales: On October 17, the company released its Q3 sales, the company reported a 5% year-on-year decrease in sales, totaling SEK 64.5 billion ($5.96 billion), missing the consensus estimate of $6.27 billion. Notably, group organic sales also dipped by 10% year-on-year, with Networks' organic sales down by 16%, partially offset by 5% growth in Cloud Software and Services and 11% in Enterprise. ERIC reported an EPS loss of SEK (9.21), in contrast to SEK 1.56 in the previous year, with adjusted EPS meeting the consensus estimate at $0.07. The company's adjusted gross margin contracted by 220 basis points to 39.2%, and the adjusted EBIT margin plunged by 460 basis points to 6.0%, reflecting a 46% year-on-year decline in adjusted EBIT. Adjusted EBITA also saw a 39% year-on-year drop to SEK 4.7 billion, with a margin of 7.3% compared to 11.3% in the prior year. Furthermore, free cash flow before M&A stood at SEK (0.5) billion.
• Disappointing guidance for Q4 and beyond: Ericsson AB's shares hit a six-year low as the company admitted that market challenges, driven by reduced investment in 5G infrastructure by US and European operators, would persist into the fourth quarter and beyond. They indicated that the uncertainty affecting their Mobile Networks business would likely continue into 2024. Ericsson reported a significant impairment of its Vonage unit and delayed its margin targets indefinitely. This led to a sharp 9.5% drop in the company's shares in Stockholm, with analysts expressing concerns over the slower-than-expected US recovery and downside risks.

ERIC's stock fell 12.46% following the company's announcement of a loss for the second quarter.

https://www.benzinga.com/news/23/07/33233787/why-state-street-shares-are-trading-lower-by-over-10-here-are-other-stocks-moving-in-fridays-mid-day

Ericsson ADR Class B (NASDAQ:ERIC) experienced a decline due to the release of its first-quarter results, which showed a 14% year-on-year sales growth to SEK 62.6 billion for FY23. However, Ericsson remains cautious about the choppy market conditions and lack of visibility for 2023. Additionally, CFO Carl Mellander will step down at the end of the first quarter of 2024. This decline in Ericsson's stock has caused Nokia's stock to follow suit.

https://beststocks.com/nokias-stock-falls-in-sympathy-with-ericssons/