Ericsson Q3 2026: Organic Sales +7%, Adjusted EBITA Down 36% on Prior-Year Gain
ERIC sits 15% above its 52-week low of $9.035 on elevated volume (2.1× avg).
Summary
Ericsson reported Q3 2026 organic sales growth of 7% to SEK 59.5b, but adjusted EBITA fell 36% to SEK 10.1b against a prior-year quarter that included a SEK 7.6b divestment gain. Management flagged flat RAN demand and rising component costs as a gross margin headwind for next year.
Key Events · Earnings and Guidance · ERIC
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Q3 Organic Sales Up 7%
Reported sales rose 6% YoY to SEK 59.5b, with organic growth of 7% driven by Networks (SEK 38.7b, +9%). Growth came in three of four market areas, led by South East Asia, Oceania and India (+25% organic) and North East Asia (+22% organic).
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Adjusted EBITA Down 36%
Adjusted EBITA was SEK 10.1b (17.0% margin) versus SEK 15.8b (28.1%) a year ago, which included a SEK 7.6b iconectiv capital gain. Excluding that gain, adjusted EBITA increased on higher gross income and lower operating expenses.
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Component Costs to Pressure 2027 Margins
Management said the RAN market is flat, geopolitical uncertainty remains elevated, and higher component costs are a headwind to gross margin next year. Q4 2026 Networks adjusted gross margin is guided to 49-51%.
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Strong Balance Sheet and Buybacks
Net cash rose to SEK 60.7b from SEK 51.9b a year ago, and free cash flow before M&A was SEK 4.9b. Ericsson repurchased 49.2M Class B shares for SEK 4.8b in Q3, bringing year-to-date repurchases to SEK 8.1b.
Analysis · ERIC · Manufacturing
Organic sales grew 7% to SEK 59.5b in Q3 2026, but adjusted EBITA fell 36% to SEK 10.1b (17.0% margin) because the prior-year quarter included a SEK 7.6b capital gain from the iconectiv divestment. Excluding that gain, profitability improved on higher gross income and lower operating expenses. The bigger issue is the outlook: management says the RAN market is flat, geopolitical uncertainty is elevated, and component costs will be a gross margin headwind next year. Q4 Networks adjusted gross margin is guided to 49-51%. The balance sheet remains strong with SEK 60.7b net cash and SEK 4.9b free cash flow before M&A, and the company repurchased SEK 4.8b of stock in the quarter. This is a mixed quarter: solid demand and cost discipline, but a softer margin trajectory into 2027.
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In the 30 days to Oct 30, 2026, 30.6% of the 1568 measured filings Wiseek scored 7 moved their stock by 5% or more by the next session's close. The median move was 0.00%. These are measured outcomes after filings of this importance, not a forecast for this one.
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At the time of this filing, ERIC was trading at $10.41 on NASDAQ in the Manufacturing sector, with a market capitalization of approximately $32.2B. The 52-week trading range was $9.04 to $13.77. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.