Why Ericsson Stock Jumped to Multiyear Highs Today
Key Points
Ericsson's earnings per share nearly tripled year over year, crushing analyst expectations.
The Swedish telecom equipment maker's stock soared over 20% to multiyear highs not seen since 2022.
Swedish media called Ericsson's third-quarter report "guldkantad" (gilded) after the company beat estimates across the board.
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Shares of Telefonaktiebolaget LM Ericsson (NASDAQ: ERIC) soared on Tuesday, while Wall Street suffered. The S&P 500 (SNPINDEX: ^GSPC) index was down as much as 1.5% shortly after the opening bell, but the Swedish telecom equipment giant had gained 20.6% by 1 p.m. ET.
Ericsson kicked off the last earnings season of this calendar year with an analyst-stumping Q3 report. The underlying stock of this American depositary receipt (ADR) gained 18% on the Stockholm Stock Exchange before that market closed at 11:30 a.m. ET.
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Ericsson's Q3 2025 by the numbers
Ericsson's Q3 sales fell 9% year over year to 56.2 billion Swedish kronor. On the other hand, diluted earnings nearly tripled from 1.14 to 3.33 kronor per share (and ADR). Swedish newspaper SvD called the report "guldkantad" (gilded), as the results exceeded the average analyst estimates across the board.
Ericsson saw positive year-over-year organic sales growth in three of its five geographic divisions, with the outlier being 8% lower orders from the Americas.
Image source: Getty Images.
The CEO sees sustained strength ahead
The stock trades at multiyear highs after this jump, exploring prices not seen since the spring of 2022. CEO Börje Ekholm noted that Ericsson's gross margins should stay at these boosted levels for the foreseeable future, driven by strong sales of high-margin software and services.
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Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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