On Tuesday, stocks of Swedish telecom equipment maker Ericsson plummeted after it posted upbeat third-quarter core earnings.
Accordingly, the networking company plunged 3.33% or 0.39 points to $11.91 per share. Then, it reversed its yesterday climb of 0.40% to $12.33 per share.
Currently, it stands with a market capitalization of $41.06 billion and shares outstanding of $386.59 million.
The latest report came in higher than the market forecasts, where the strong 5G equipment sales offset its loss of shares in China.
Moreover, Ericsson’s quarterly adjusted operating earnings elevated to $1.02 billion year-over-year from $999.34 million.
Remarkably, it surpassed the analysts’ projection of $911.84 million.
In comparison from the second quarter, its net sales climbed to 56.30% from 54.90%.
At the same time, its net income rose to 5.80% from the previous rate of 3.90%.
Additionally, its diluted earnings per share hiked to $0.20 from the last data of $0.13.
Then, the total revenue slightly fell 2.00% to $6.55 billion, a plunge from the expected $6.76 billion. Whereas, the decline in revenue mirrored the loss in China.
However, global supply chain problems overshadowed the better-than-expected report.
Also, the firm noted some failed hardware deliveries amid chip shortages and logistics conflicts in the late third quarter.
Correspondingly, Nokia, a rival of Ericsson, also marked the effect of the supply bottleneck. The Finnish company edged down 1.24% or 0.07 points to $5.94 per share.
On a positive note, Ericsson secured 5G contracts from highly-valued American telecom firms Verizon, AT&T, and T-Mobile. Consequently, this move significantly helped the business.
European Stocks Up as Ericsson Declined
Meanwhile, most of the European stocks escalated, mirroring the recent gains of Wall Street.
Accordingly, the pan-European STOXX 600 index rose 0.28% or 1.33 points to $468.37 per share.
Correspondingly, the European STOXX 50 index improved 0.37% or 15.22 points to $4,166.62 per share.
In Germany, the MDAX Performance index strengthened 0.22% or 76.69 points to $34,466.34 per share.
It is the same with the benchmark DAX 40 as it extended to 0.16% or 24.14 points to $15,498.61 per share.
In London, the FTSE All-Share index enriched 0.05% or 2.15 points to $4,112.32 per share.
Consequently, the CAC 40 index inched up 0.13% or 8.98 points to $6,682.08 per share.