ERIC - Telefonaktiebolaget LM Ericsson (publ) (ERIC) Q4 2023 Earnings Call Transcript
2024-01-23 07:42:06 ET
Telefonaktiebolaget LM Ericsson (publ) (ERIC)
Q4 2023 Earnings Conference Call
January 23, 2024, 03:00 AM ET
Company Participants
Peter Nyquist - VP & Head, IR
Börje Ekholm - President, CEO
Carl Mellander - SVP, CFO and Head, Group Function Finance & Common Functions
Conference Call Participants
Aleksander Peterc - Societe Generale
Erik Lindholm-Röjestål - SEB
Francois Bouvignies - UBS
Jakob Bluestone - BNP Paribas Exane
Sandeep Deshpande - JPMorgan
Sebastien Sztabowicz - Kepler Chevreux
Presentation
Operator
Hello, everyone, and welcome to Ericsson's Fourth Quarter and Full Year Results of 2023. With me today, I have, as usual, our CEO, Börje Ekholm; and our CFO, Carl Mellander. And we will end this presentation as normal with Q&A. And in order to ask questions, you will need to join the conference by phone. Details can be found on today's press release or on our website, ericsson.com/investors. Please be also advised that this conference is recorded.
But before handing over to Börje, I would like to read the following. During today's presentation, we will be making forward-looking statements. These statements are based on our current expectation and certain planning assumptions, which are subject to risks and uncertainties. The actual result may differ materially due to factors mentioned in today's press release and discussed in this conference call. We encourage you all to read about these risks and uncertainties in an earnings report today as well as in the annual report.
With that said, I would like to hand over the word to Börje. So please, Börje.
Börje Ekholm
Thanks, Peter, and good morning, everyone. Thanks for joining us today. So in 2023, we navigated a difficult mobile networks market marked by persistent headwinds and an unprecedented slowdown in the North American market, which really saw customers reducing CapEx significantly.
With the rapid growth in India, we saw a dramatic change in business mix. But overall, the total mobile networks market really fell in size. Notwithstanding these challenges, we continue to execute on our strategy, and I'm pleased to say that we concluded 2023 with a solid quarter, and we succeeded in generating an EBITA of SEK 21.4 billion for the full year.
Through our strong focus on gross margin that we've had for many years, as you know, we generated almost 40% gross margin for the year. While our actions to improve performance are paying off, we're not satisfied with our profitability. So we have clearly much more work to do.
As we look ahead, 2024 will be a difficult year, and market conditions will prevail. And so we currently expect the current market outside of China to further decline as our customers remain cautious and the investment pace normalizes in India.
With that in mind, we remain laser focused on managing what's in our control. We are consistently driving operational efficiency while keeping the investments critical to our future growth intact. We remain firmly committed to our long-term goals of 15% to 18% EBITA and 9% to 12% free cash flow. And we are seeking to maximize the value for all our stakeholders....
Telefonaktiebolaget LM Ericsson (publ) (ERIC) Q4 2023 Earnings Call Transcript