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LM Ericsson Telephone Company (ERIC)

  • Dec. 10, 2013, 2:55 PM
    • During a UBS conference talk, AT&T (T -0.5%) CEO Randall Stephenson promises his company will bring last-mile fiber services to markets other than Austin. AT&T has already responded to Google's Austin Fiber announcement by promising to offer 1Gbps services to residents, but has been light on details.
    • Stephenson doesn't say where AT&T will offer similar services, but does assert "there are lots of other opportunities around the country," and that "the economics of fiber deployment are really starting to look good in communities like Austin."
    • Any large-scale residential fiber rollout could require AT&T to ramp its capex, which the company has generally been loathe to do in recent years.
    • Separately, Stephenson notes AT&T is seeing tough competition in the low-end mobile market; the carrier has lost prepaid share this year, though its Q3 numbers suggest it's turning a corner following the launch of its Aio and GoPhone plans.
    • Also: In a comment that suggests AT&T (like Verizon) may need to step up its 4G infrastructure spending, Stephenson declares his company is still seeing 50% Y/Y growth in data consumption per smartphone user, thanks to heavy video use.
    • With AT&T and Verizon ahead of many foreign carriers in seeing large-scale 4G uptake, their data traffic issues could be a sign of things to come. A pickup in mobile capex to address the issue would benefit infrastructure vendors Nokia (NOK), Alcatel-Lucent (ALU), and Ericsson (ERIC), as well as carrier Wi-Fi vendor Ruckus (RKUS).
  • Nov. 29, 2013, 10:16 AM
    • The Indian government is set to investigate Ericsson (ERIC +1.1%) over the patent royalty rates it's seeking from local phone OEM Micromax, which Ericsson sued for infringement in March.
    • While Ericsson wants royalty rates tied to the sale price of a phone (common in many mobile licensing deals), Micromax argues the price should be based on a fixed value assigned to the IP being used. Ericsson, which has a large stable of standards-essential 2G, 3G, and 4G patents, has been seeking a deal on FRAND terms.
    • Ericsson is in the midst of a similar patent dispute with Samsung; the ITC has been drawn into that one.
    • Separately, Swedbank has upgraded Ericsson to Buy this morning. Shares of the mobile infrastructure leader are up 24% YTD.
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  • Nov. 15, 2013, 9:07 AM
    • SAP has been upgraded to Overweight by Barclays. Shares +1.3% premarket.
    • Ericsson (ERIC) has been upgraded to Buy by Banco Santander. Shares +2%.
    • Millennial Media (MM) has been cut to Neutral by Goldman two days after it posted a disappointing Q3 report (I, III).
    • GOGO has been cut to Underweight by Morgan Stanley following a huge run-up in response to a strong Q3 report and a positive FAA ruling. Two other firms have already downgraded the in-flight Wi-Fi provider since its Q3 report. Shares -3.1%.
    • ARM (ARMH) has been started at Outperform by JMP.
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  • Nov. 1, 2013, 4:54 AM
    • The consortium that bought thousands of Nortel patents for $4.5B in 2011 has sued Google (GOOG), Samsung (SSNLF, SSNGY), HTC (HTCCY), Huawei and four other companies for infringing some of the IP.
    • The group, called Rockstar, is owned by Apple (AAPL), Microsoft (MSFT), Blackberry (BBRY), Ericsson (ERIC) and Sony (SNE).
    • The patents cited in the suit cover technology that enables targeted advertising on Internet search results - the core of Google's money making machine.
  • Oct. 30, 2013, 12:41 PM
    • Nokia (NOK +2%) has made fresh 52-week highs today, and is up 13% since delivering market-pleasing Q3 results and Q4 guidance yesterday morning. A two-notch upgrade to Buy from Denmark's Danske Bank is helping Nokia's cause; Danske issued a similar upgrade in April before having a change of heart.
    • Meanwhile, a U.K. court has ruled in Nokia's favor in a patent infringement case against HTC. The ruling follows a favorable U.S. ITC verdict against HTC in September. With Nokia set to no longer sell hardware for which it needs patent cross-licenses, the company is bound to become more aggressive in its IP licensing efforts.
    • Also: Evercore and Cowen have each reiterated neutral ratings following the Q3 report. Evercore likes positioning and balance sheet in the wake of the Microsoft deal, but also calls NSN "a weak #2 player" in a competitive mobile infrastructure market. The firm estimates NSN has a 15% mobile infrastructure share, half that of market leader Ericsson (ERIC +0.7%).
    • Cowen is more upbeat, arguing NSN could post again post a double-digit op. margin in 2014, and that the division's strong LTE positioning could allow it to deliver top-line growth next year.
  • Oct. 24, 2013, 3:07 AM
    • Ericsson's (ERIC) Q3 EBIT rose to 4.2B kronors ($658M) from 3.1B kronors a year earlier but missed consensus of 4.5B.
    • Net profit +34% to 2.92B kronors, with a better business mix strengthening margins.
    • Revenues -3% to 52.98B kronors vs forecasts of 55.1B kornors; sales were hurt by forex fluctuations as well as by reduced activity in Japan and two large maturing projects in the U.S.
    • Ericsson CEO Hans Vestberg says the macroeconomic environment has stabilized in many regions, while the "long-term fundamentals in the industry remain attractive." However, "uncertainty still remains in certain parts of the world," Vestberg adds. (PR)
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  • Oct. 24, 2013, 12:05 AM
  • Oct. 23, 2013, 5:30 PM
  • Oct. 14, 2013, 2:37 PM
    • Barclays, which upgraded Alcatel-Lucent (ALU +4.3%) to Overweight and cut Ericsson (ERIC -1.9%) to Underweight this morning, thinks speculation about a merger between Alcatel and Nokia (NOK -0.5%) is credible, and sees the combined company providing tougher competition for Ericsson (currently the mobile infrastructure market's top vendor).
    • There have been reports Nokia, set to reap a $7.2B windfall from the Microsoft deal, is thinking of approaching Alcatel about a tie-up. However, no talks are believed to be underway, and the reports didn't explicitly state Nokia is eying a full-blown merger.
    • Mergers between major networking/telecom equipment vendors have often yielded share losses rather than gains in the quarters following the deal's completion, thanks to both integration challenges and efforts by common customers to diversify their supplier lists. Alcatel's merger with Lucent acts as an example.
  • Oct. 14, 2013, 9:42 AM
    • Alcatel-Lucent (ALU +1.4%) has been upgraded to Overweight by Barclays, and Ericsson (ERIC -3.3%) cut to Underweight.
    • AMD (AMD +1.4%) has been upgraded to Outperform by Wedbush.
    • Stratasys (SSYS +2.2%) has been upgraded to Buy by Dougherty & Co.
    • Glu Mobile (GLUU +1.3%) has been upgraded to Buy by B. Riley.
    • Mattson (MTSN +4.9%) has been upgraded to Buy by B. Riley.
    • Expedia (EXPE -6.9%)  has been cut to Hold by Deutsche.
    • Atmel (ATML -1.9%) has been cut to Sector Perform by Pac Crest.
    • As part of a coverage launch for chip equipment stocks, KLA-Tencor (KLAC +0.6%) and Lam Research (LRCX -0.4%) have been started at Overweight by JPMorgan, and Applied Materials (AMAT -1.2%) has been started at Neutral.
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  • Sep. 28, 2013, 2:40 PM
    • John Chambers (CSCO): "We do everything in wireless except for the radio ... Now, we have a creative idea there, and I’ve just funded our first startup to see if that works ... The market is ripe for a new player."
    • Chambers won't name the startup, but his remarks suggest Cisco plans to directly take on Ericsson (ERIC), Nokia (NOK), and Alcatel-Lucent (ALU) in the giant mobile base station market. Cisco recently bought small cell base station vendor Ubiquisys, and also sells switches/routers and management software to mobile carriers, but until now has argued the core base station market is too commoditized.
    • Separately, Chambers predicts "IT as a service and white label will be [Cisco's] biggest competitors three to five years out." That's a reference to cloud infrastructure providers (none larger than Amazon), who often rely on cheap white-label switches, as well as the use of similar hardware from Web giants such as Facebook and Google.
    • Chambers also: 1) Insists Cisco's storage alliances with the likes of EMC and NetApp (NTAP) will stay in place, in spite of the Whiptail deal. 2) Predicts Cisco's upcoming Insieme switches will help it compete against private Arista. Arista, whose high-density switches use 3rd-party silicon (unlike Cisco's), could do a huge IPO next year. 3) Questions the scalability of the software-defined networking platform offered by VMware's (VMW) Nicira unit (generally seen as a threat), and claims Nicira has less than $10M worth of deployments. Of course, the value of the switches managed by Nicira's products could be much larger.
    • Previous: Cisco lower, Chambers cautious about macro trends
  • Sep. 20, 2013, 9:53 AM
    • Facebook (FB +0.7%) has been upgraded to Outperform by Cowen. The upgrade comes with shares having risen 73% since the Q2 report.
    • Tibco (TIBX +4.6%) and Informatica (INFA +4.3%), two companies frequently hyped as big data/analytics plays, have been upgraded to Positive by Susquehanna. Tibco delivered an FQ3 beat and provided in-line FQ4 guidance yesterday afternoon.
    • SunEdison (SUNE +2.5%) has been upgraded to Outperform by RBC.
    • Portugal Telecom (PT +4.8%) has been upgraded to Outperform by Bernstein.
    • Synaptics (SYNA +2.1%) has been upgraded to Outperform by Oppenheimer.
    • NetApp (NTAP -1%) has been cut to Underperform by William Blair.
    • SolarWinds (SWI -4.4%) has been cut to Sell by Goldman.
    • Ericsson (ERIC -2.1%) has been cut to Hold by DNB.
    • Level 3 (LVLT -1.9%) has been cut to Equal Weight by Morgan Stanley.
    • ExOne (XONE -0.3%) has been started at Outperform by FBR.
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  • Sep. 12, 2013, 12:52 PM
    • Rostelcom, Russia's biggest wireline carrier (28M total subs and 9.5M broadband subs), has deployed what Ericsson (ERIC +0.7%) calls the world's largest carrier-run content delivery network (CDN). The CDN was built using Ericsson's Media Delivery Network CDN platform and related integration services. (PR)
    • Carrier CDN-building efforts pose a challenge to Akamai (AKAM +0.6%) and Limelight (LLNW). Akamai, which can still boast unmatched global scale for its CDN, is trying to address the threat through its Aura Network Solutions platform. France's Orange signed up to be an Aura customer last year.
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  • Sep. 6, 2013, 11:35 AM
    • Ericsson (ERIC +4.3%) has acquired femtocell base station developer Airvana's 3G EV-DO ops in an all-stock deal. (PR)
    • Though Ericsson notes Airvana supplies it with EV-DO software and states the deal will help it support carriers who have deployed EV-DO (e.g. Verizon, Sprint, KDDI - they're now mostly investing in 4G), the company's main goal appears to have been the dismissal of a $330M suit filed by Airvana against Ericsson, in which the former alleged the latter conspired with LG to sell Airvana hardware without including (royalty-bearing) software.
    • Separately, Ericsson has announced a 4G infrastructure deal with Telefonica's Spanish unit. Ericsson will be the supplier for 1K of the 2.2K 4G nodes Telefonica plans to deploy in 2013, including the ones for Madrid and Barcelona. Alcatel-Lucent announced a Spanish 4G deal with Telefonica yesterday.
    • Altogether, Ericsson says it has scored 160+ 4G deals worldwide. Earlier this year, research firm TBR observed Ericsson "took a commanding lead" of the 4G infrastructure market in 2012 thanks to North American, Japanese, and South Korean deal traction. It forecast Ericsson would maintain the pole position in 2013, but added rivals are set to gain share.
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  • Sep. 4, 2013, 3:01 PM
    • Equipment vendors Adtran (ADTN +10.1%), Ruckus (RKUS +4.5%), Aruba (ARUN +2.5%), Ericsson (ERIC +2.2%), Procera (PKT +2.1%) and Calix (CALX +2.3%), and component/chip suppliers Oplink (OPLK +4.1%), NeoPhotonics (NPTN +2.3%), Alliance Fiber (AFOP +3.1%), AppliedMicro (AMCC +5%), and PMC-Sierra (PMCS +1.9%) have joined the ranks of names outperforming following Ciena's (CIEN +13.6%) strong numbers (fueled by strong demand for metro/edge networking hardware) and Juniper's upbeat conference comments about Q3 bookings and router demand.
    • Ciena mentioned on its FQ3 CC U.S. orders were relatively strong (likely a sign of strong AT&T/Verizon spending), as North American carriers lead the way in adopting newer technology platforms (100G optical, integrated Ethernet/optical hardware, etc.), However, the company also claimed Europe is stabilizing, and that it's seeing new customer wins in Latin America/Asia.
    • Ciena also touted its share gains, noting Heavy Reading calls it the leader in the fiber-based Ethernet access switch space, and that Dell'Oro ranks its first in the integrated Ethernet/optical market. However, it does look as if Ciena has lost some share in optical transport (revenue +15% Q/Q but -26% Y/Y). The company says new customer wins will lead transport growth to pick up.
  • Sep. 3, 2013, 9:12 AM
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Company Description
LM Ericsson Telephone Company is a provider of communications technology and services. Its offerings include services, software and infrastructure in information and communications technology for telecom operators and other industries.
Sector: Technology
Country: Sweden