Strategic highlights - Robust execution reflecting a more balanced global footprint

• Strong organic sales growth of 6%*, led by Networks, as customer demand broadened across regions.
• AI native radios announced at Mobile World Congress, extending technology leadership.
• Share buyback program up to SEK 15 b. approved and expected to commence on April 23, 2026.

Financial highlights - Solid financial performance with broad-based contribution

• Reported sales were SEK 49.3 (55.0) b. Organic* sales increased by 6%* YoY, with organic growth in all segments. 
• Adjusted[1] gross income decreased to SEK 23.7 (26.7) b., reflecting currency headwinds. Reported gross income was SEK 23.3 (26.5) b.
• Adjusted[1] gross margin was 48.1% (48.5%). Cloud Software and Services gross margin increased, while Networks margin decreased slightly. Reported gross margin was 47.2% (48.2%).
• Adjusted[1] EBITA was SEK 5.6 (6.9) b., with a 11.3% (12.6%) margin, mainly reflecting currency headwinds. EBITA was SEK 1.8 (6.7) b., impacted by -3.8 (-0.3) b. of restructuring charges.
• Net income was SEK 0.9 (4.2) b. reflecting restructuring charges and currency impacts. Diluted EPS was SEK 0.27 (1.24).
• Free cash flow before M&A was SEK 5.9 (2.7) b., driven by increased operating cash flow.

Börje Ekholm, President and CEO, said: "Our Q1 results demonstrate continued resilience in a dynamic environment, with organic sales growth of 6%. Our healthy gross margins and strong cash flow reflect the progress we have made in recent years, reducing reliance on geographic mix and strengthening our foundations globally.

Our multi-year investments in building a resilient, diversified, supply chain have enabled us to deliver consistently for customers amidst geopolitical and macroeconomic uncertainties. We are facing increasing input costs, especially in semiconductors, caused in part by AI demand. Our ambition is to offset these challenges, by working closely with customers and suppliers, and through product substitution and efficiency actions.

Looking ahead, while we continue to expect a flattish RAN market, our focused strategy, leading portfolio, and strengthened positions in mission critical and Enterprise give us confidence in our ability to grow faster than the mobile networks market and drive long-term success."

* Sales adjusted for the impact of acquisitions and divestments and effects of foreign currency fluctuations.
[1] Adjusted metrics are adjusted to exclude restructuring charges.
[2] Non-IFRS financial measures are reconciled at the end of this report to the most directly reconcilable line items in the financial statement.

NOTES TO EDITORS

You find the complete report with tables in the attached PDF or on www.ericsson.com/investors

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