Ericsson American Depositary Shares - ERIC STOCK NEWS

Ericsson has announced its exit from operations in Russia by divesting its local customer support business. An asset transfer agreement was established with a Russian company owned by former operational managers, involving approximately 40 employees and related assets. This move comes after Ericsson halted operations in Russia following the invasion of Ukraine, impacting around 400 employees. By the end of 2023, all customer engagements in Russia are expected to cease, though a legal entity will remain to handle administrative duties.

Ericsson (NASDAQ: ERIC) has extended its Independent Compliance Monitor's term by one year, now concluding in June 2024, to further enhance its governance and compliance practices. This follows a Deferred Prosecution Agreement with the U.S. DOJ and a Consent Judgment with the SEC from 2019, aimed at addressing FCPA violations. CEO Börje Ekholm emphasized the commitment to improving the company’s Ethics and Compliance program, while Chairman Ronnie Leten highlighted advancements in internal controls. This extension underscores Ericsson's dedication to integrity and robust compliance.

Ericsson emphasizes the crucial role of universal connectivity in fostering economic growth and social inclusion in its message to G20 leaders. The B20 Digitalization Taskforce identified key goals, including enhancing digital skills and expanding digitalization among micro, small, and medium enterprises (MSMEs), which constitute 90% of global businesses. The taskforce recommends prioritizing private sector network expansion and addressing cybersecurity to support MSMEs. With an estimated 2.7 billion people lacking connectivity, the call for $428 billion investment over ten years aims to bridge the digital divide and enhance access to education and job opportunities.

On December 9, 2022, Niko Pakalén succeeded Jonas Synnergren as the representative for Cevian Capital Partners Limited on Ericsson's Nomination Committee. The committee now comprises five members, including Johan Forssell, Karl Åberg, Anders Oscarsson, and Ronnie Leten, who chairs the committee. This change in representation is part of Ericsson's governance structure, which includes efforts to ensure effective shareholder representation and decision-making.

Ericsson and Apple have reached a multi-year global patent license agreement that includes a cross-license for patented cellular standard-essential technologies. This settlement resolves all ongoing patent-related lawsuits between the two companies across various jurisdictions, including the US. Ericsson expects fourth quarter 2022 IPR licensing revenues to be between SEK 5.5 - 6.0 billion. The agreement is deemed strategically important for Ericsson's 5G licensing program and positions both companies to enhance their collaboration in technology development.

Ericsson emphasizes the critical role of telecom standards in fostering global connectivity, economic growth, and job creation. Highlighting the impact of the 3GPP standards organization, the company notes that mobile technologies accounted for 4.7% of global GDP, equating to $4.1 trillion in economic value. The telecom sector supported 30 million jobs and contributed $490 billion in taxes. The future of telecom is linked to the evolution of 5G and its role in decarbonization, with predictions of nearly 3.5 billion 5G connections by 2026.

Ericsson has announced the transfer of its IoT Accelerator and Connected Vehicle Cloud businesses to Aeris, which will solidify Aeris' position as a market leader in IoT. This transaction is set to close in Q1 2023 and includes the transfer of assets and employees. While the divestment will incur a one-off negative EBIT impact of SEK 1.1 billion in Q4 2022, it is expected to eliminate ongoing losses of SEK 0.25 billion per quarter. Together, the platforms will connect over 100 million IoT devices across 190 countries.