The share price fell 7-8 percent on the Stockholm Stock Exchange after the telecom giant reported a slightly lower quarterly profit than expected.
Adjusted operating profit fell to SEK 6.5 billion for the second quarter, compared with SEK 7.0 billion in the same period last year.
"We are delivering a stable quarter, albeit with slightly declining sales," Börje Ekholm said in an interview with TT.
Revenues fell 6 percent to SEK 52.7 billion, while higher costs for computer chips are putting pressure on profitability. Price adjustments and tighter cost control lie ahead, according to Börje Ekholm.
It's a challenging environment with component inflation, how memory prices are developing, etc. We have to balance that, and we do that through internal measures, cost efficiency and how we develop products, among other things.
Do you need to reduce staff even more?
We are in a fairly “flat-ish” market; it is not growing very much. And that requires us to be cost-effective, he says.
Potential in AI
Even though the market is not growing much, Ekholm sees potential for growth in AI.
The discussion is very focused on data centers and semiconductors. But the next step is for it to move into applications and for companies to use AI in their operations. That requires a different type of connectivity, so we are quite optimistic about the demand for mobile networks.
Ekholm is in his tenth year and will step down as CEO this fall. This is his last quarterly report.
I am most pleased that we have fantastic employees in this company. We have a very good financial position. This creates opportunities to take the next step.
Boost towards Europe
Börje Ekholm comments on the industrial climate in Sweden.
You have to be humble when it comes to politics. It's easy to sit and review and I often think that's a bit unfair. I think you can say that in Sweden, if you look locally, we have an incredibly strong position. We have a very competitive business community overall.
The problem is not Sweden, he says.
I usually say that our big problem is that we are in a "shitty neighborhood"; Europe is not in the same condition at all.
About your own future?
We'll see. I'll probably take on one or more board assignments. I expect to get involved in something of my own. Maybe hike a bit in the mountains and go skiing, says Ekholm, who lives in the US.
