For the fourth quarter of 2015, Ericsson saw an increase in sales of 8 percent year-over-year, to 73.6 billion Swedish krona (US$8.6 billion). But in constant-currency terms, sales decreased by 1 percent.
Net income rose by 68 percent compared with the same period last year, to 7 billion krona ($822 million). However, that wasn’t enough to appease investors, and the company’s stock is down about 6 percent this morning, to $9.09 on Nasdaq.
Ericsson CEO Hans Vestberg said the quarter was “one of the highest sales quarters we have had for many, many years.”
But the company’s press release read: “After a period of investing, in order to create growth, we also need to improve earnings. This will involve stronger focus on software sales and recurring business as a complement to the already strong professional services business.”
Sales in the networks business increased 9 percent in the fourth quarter compared to the same quarter in 2014, although in comparable units and currency, the performance was flat.
During the quarter, Ericsson got a boost from a patent licensing settlement with Apple in which Apple made an unspecified initial payment to the Swedish company and also agreed to make ongoing royalty payments.
For 2016, the company will focus on capturing opportunities as more markets around the world shift to 4G. At the same time, it wants to lead in the emerging 5G market.