Ericsson Sinks on Q2 Profit Dip

took a hit on the Stockholm exchange today as it announced a worse than expected fall in second quarter profits. (See Ericsson Reports Q2.) A slump in earnings had been expected (see Ericsson Dips On Q2 Concerns), but a 70 percent year-on-year fall in net income to 1.9 billion Swedish Kronor (US$319 million) was a bigger hit than the financial markets had anticipated. The news sent the Swedish vendor's share price down by 8.8 percent to SEK68.50 in morning trading. (Please note that differences in historical share price figures are due to a 1:5 reverse stock split on June 4, 2008.) Four factors contributed to the decline in profits. First, device joint venture Sony Ericsson Mobile Communications only broke even in the second quarter, so there were no profits flowing through to the parent companies. The handset vendor, which... [read full story]