Ericsson's Networks segment has seen a significant fall in sales in the Southeast Asia, Oceania, and India region, led mainly by lower sales in India. This slowdown is a consequence of the normalization of capital spending by Indian telecom operators after the record year of 2023. The deceleration in 5G investments by India's top telcos, such as Reliance Jio and Bharti Airtel, has led to a major hit on Ericsson's revenue in the region.
Key Highlights:
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Sales Fall: Ericsson saw a 44% year-over-year fall in sales in the India, Southeast Asia, and Oceania region, of which a large part is contributed by India.
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India's Contribution: India's contribution to Ericsson's worldwide sales declined to 6% in 2024 from 12% in 2023 due to lowering investments made by Indian telecos.
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5G Rollout Completion: Completion of early 5G network deployments by Indian carriers has resulted in reduced demand for new gear, impacting Ericsson's sales.
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Global Performance: While the situation in India was challenging, Ericsson's sales in North America have experienced tremendous growth, with the boost of rising network spending by U.S. customers.
These events showcase the difficulties faced by telecom gear makers in sustaining sales momentum in markets with declining investment levels.
Source: Economic Times, Financial Express, Business Standard.