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Business News

Ericsson sees profits slump 61 per cent

Ericsson, the telecoms equipment maker, saw profits plunge more than 60 per cent in the three months to June as the downturn continues to batter the industry around the world.

Carl-Henric Svanberg, the president and chief executive of Ericsson, said: "The effects of the global economic climate on the mobile infrastructure market are now more notable, especially in markets with currencies under pressure and tougher credit environment."

Ericsson posted net profits of Skr800m (£65m), down from Skr2bn in the corresponding quarter last year, as it suffered from charges following its cost cutting drive, as well as pressure at its joint ventures. The group hopes to cut Skr10bn in the second half of the year, leading to restructuring charges of Skr3.6bn. Its mobile phone handset joint venture with Sony lost €213m (£184m), and ST Ericsson, the semiconductor group with STMicroelectronics lost $213m (£130m).