Swedish telecom equipment manufacturer Ericsson on Tuesday said sales from India fell after telecom operators moderated capex in the current fiscal, leading to a 44% decrease in sales from Southeast Asia, Oceania, and India for the September quarter.
While Southeast Asia, Oceania, and India continue to be the second largest market by sales for Ericsson, their contribution to global sales has come down significantly on-year.
“Sales grew by 15% in market area North America. Growth was offset by materially lower sales in market area Southeast Asia, Oceania and India, as investment levels in India have normalised after a record year in 2023,” the company said in its September quarter earnings report.
In 2023, both Reliance Jio and Bharti Airtel were expanding their 5G network on a war footing, leading to increased capex. However, as the first phase of 5G network rollout for both has almost been completed, the capex has started to taper.
Jio’s capex for the April-September 2024 period was Rs 15, 600 crore, almost half of the Rs 34, 500-crore capex in the same period last year, according to the telco’s Q2 earnings data.
“Since the second quarter (April-June), Ericsson has been awarded major new contracts in multiple markets, including 4G and 5G deals with Vodafone Idea in India,” Ericsson added in its report.
Ericsson follows a January-December fiscal cycle.
As a result of slowdown in investments by Indian operators, Southeast Asia, Oceania, and India market’s contribution to global sales decreased to 5% compared to 15% in the same time last year. The US continues to the strongest market for Ericsson, followed by India, China, the UK, and Japan.
India overtook China and Japan as Ericsson’s second-largest market in the December 2022 quarter.
The company’s sales fell 4% y-o-y to 61.8 billion Swedish Krona (SEK) or $5.97 billion from 64.5 billion SEK ($6.23 billion) in the same quarter last year.
From: financialexpress
Financial News
