Telefonaktiebolaget LM Ericsson (publ) (ERIC): Business Model Canvas [Dec-2025 Updated]

You're looking at a telecom giant making a serious pivot, and frankly, understanding the new structure is key to valuing Telefonaktiebolaget LM Ericsson (publ) right now. After a decade leading the charge in hardware, the real story for 2025 is the aggressive push into software and enterprise solutions, supported by a massive USD 5 billion annual R&D spend to keep that 57,000+ patent portfolio ahead. We've mapped out exactly how they plan to make that shift-from their core Networks segment, projected at $16 Billion, to the growing Cloud Software and Services, aiming for $6.1 Billion-so you can see where the next decade of value creation is really hiding. Dive into the full Business Model Canvas below to see the partnerships and revenue streams driving this transformation.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Telefonaktiebolaget LM Ericsson (publ) (ERIC) relies on to deliver its value propositions, especially as the industry pivots toward software and network monetization. Here's the breakdown of those critical alliances as of late 2025.

Major Communication Service Providers (CSPs) like AT&T and Verizon

The relationship with major CSPs remains the bedrock, driving the bulk of the Networks division revenue. The massive $14 billion AT&T OpenRAN deal, signed in December 2023, significantly impacted recent performance. For the second quarter of 2025, the US market, heavily influenced by that contract, accounted for a stunning 44% of Telefonaktiebolaget LM Ericsson (publ) (ERIC)'s sales, with North American organic revenues reaching SEK 19.8bn ($2.05bn) year-over-year. Also, in the UK, Telefonaktiebolaget LM Ericsson (publ) (ERIC) secured an 8-year partnership with Vodafone-3 to supply a significant majority of their mobile networks. These large-scale infrastructure deals are key, even as overall telco investment in RAN equipment declined by 12.5% (or $5 billion) last year.

Strategic alliance with LotusFlare for network API monetization (Dec 2025)

A very recent move was the strategic partnership with LotusFlare, announced on December 3, 2025, to accelerate the monetization of network APIs. As part of this, Telefonaktiebolaget LM Ericsson (publ) (ERIC) acquired a minority stake in LotusFlare, which has about 500 employees globally. The financial terms of this investment were not disclosed. This alliance focuses on providing common solution blueprints for a Network API Exposure Layer, covering API access and consent management, complementing Telefonaktiebolaget LM Ericsson (publ) (ERIC)'s existing Vonage offerings.

Technology partners (e.g., Qualcomm, Intel) for 5G/6G development

Telefonaktiebolaget LM Ericsson (publ) (ERIC) continues to collaborate with silicon and technology leaders to push the envelope on future standards. The company is actively strengthening its leadership in mobile networks, aiming to offer a portfolio of 130 radios this year that all support programmable networks. These foundational technology partnerships are essential for developing the open API architectures that are central to new revenue streams.

Global Systems Integrators (GSIs) and resellers for Enterprise sales

For the Enterprise segment, which is targeted for stabilization in 2025, channel partners like GSIs and resellers are crucial for market reach. The Enterprise division's second-quarter 2025 revenues stood at SEK 5.5bn ($570m), though sales shrank 6% YoY even after currency adjustments. The company expects this segment to stabilize year-over-year on an organic basis.

stc Group Fusion Partnership for co-creating value-added solutions

The collaboration with stc Group, announced at LEAP 2025, is a significant regional strategic alignment, building on a relationship spanning over 50 years. This Fusion Partnership focuses on co-creating value-added solutions across all network domains. Specific initiatives include adopting Ericsson Charging to boost 5G and network API monetization, and trialing the 5G Cloud Radio Access Network (RAN). Furthermore, an MoU established a six-month on-the-job training program for stc Group employees.

Here's a quick look at the scale and recent financial context surrounding some of these key relationships:

Partner/Segment	Metric	Value/Detail	Date/Period
AT&T Deal	Contract Value	$14 billion	Announced Dec 2023
North America (CSPs)	Q2 2025 Revenue	SEK 19.8bn ($2.05bn)	Q2 2025
LotusFlare Investment	Stake Acquired	Minority Stake	Dec 2025
stc Group	History of Collaboration	Over 50 years	Ongoing
Enterprise Division	Q2 2025 Revenue	SEK 5.5bn ($570m)	Q2 2025
Overall Company	Q3 2025 Net Cash	SEK 51.9 billion	Q3 2025

The focus on network API monetization via LotusFlare and the stc Group alignment shows a clear push to generate revenue beyond traditional equipment sales, which is important given the overall TTM revenue ending September 30, 2025, was $23.685B. The Q3 2025 adjusted gross margin hit 48.1%, partly due to operational excellence across segments.

Key partnership activities include:

• Developing common solution blueprints for Network API Exposure Layer.
• Adopting Ericsson Charging for 5G monetization with stc Group.
• Expanding the programmable network radio portfolio to 130 radios this year.
• Providing a six-month on-the-job training program for stc Group staff.
• Focusing Enterprise sales efforts on more profitable market segments.

Finance: draft 13-week cash view by Friday.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Key Activities

Global Research and Development (R&D) in 5G Advanced, 6G, and AI

Telefonaktiebolaget LM Ericsson (publ) (ERIC) commits substantial resources to future technology development, though recent spending shows a shift in pace.

The 12-month R&D expense ending September 30, 2025, was reported at $4.897 billion. For the first nine months of 2025, R&D spending decreased by 10% year-over-year, totaling SEK 35.8 billion (about $3.8 billion). This investment supports the technological leadership that resulted in 1,530 patents, a 27% year-on-year increase as of 2024. The company powers 42 of the world's 70+ live 5G Standalone (SA) networks. Global 5G subscriptions are forecast to top 2.9 billion by the end of 2025, representing about one third of all mobile subscriptions.

Manufacturing and deployment of Radio Access Network (RAN) equipment

The Networks segment remains the primary revenue driver, with expectations set for FY2025.

Metric	Value (FY2025 Est.)	Value (Q3 2025 Reported)	Value (Q1 2025 Reported)
Segment Revenue (SEK Billion)	N/A	SEK 35.4 billion	SEK 35.6 billion
Segment Revenue (USD Billion)	$16 Billion	($3.7 billion)	N/A
Revenue Share of Total	65%	N/A	N/A
Adjusted EBITA Margin	N/A	N/A	21%

The company held a 25.7% share of the global RAN market in 2024. North America represented 44% of Ericsson's second-quarter sales in 2025.

Developing and integrating programmable network APIs via Vonage/Aduna

Monetization efforts are focused on software-driven services, leveraging the Aduna joint venture and the Vonage platform.

• Aduna deployed across three operators in Japan (SoftBank, NTT DOCOMO, and KDDI) in Q2 2025.
• IPR licensing revenue reached SEK 4.9 billion in Q2 2025, up from SEK 3.9 billion.
• The global telecom API market was valued at $6.89 billion by 2025.
• Aduna's CAMARA-based APIs are projected to grow to $7.6 billion by 2030 (from $550 million in 2024).

The Cloud Software and Services group, which includes these activities, saw reported sales rise 3% to SEK 15.3 billion ($1.6 billion) in Q3 2025, with an organic improvement of 9%. The segment swung to an adjusted EBITA profit of SEK 0.2 billion in Q1 2025 from a loss of SEK 0.3 billion year-over-year.

Rigorous operational efficiency and cost reduction programs

Cost discipline has driven significant margin expansion across the business.

• Total employee count reduced by about 6% or 6,000 over the last year (as of July 2025).
• Adjusted gross margin reached 48.5% in Q1 2025, compared to 42.7% in Q1 2024.
• Adjusted EBITA margin hit 12.6% in Q1 2025, up from 9.6% the prior year.
• The Q2 2025 Adjusted EBITA margin was 13.2%, up from 6.8% in Q2 2024.
• Analysts forecast mobile networks gross margins to exceed 50% in 2025.

Operating margins are forecasted to remain steady in the 12-15% range through 2026.

Managed network services and network optimization for CSPs

These services fall under the Cloud Software and Services segment, which is showing a positive trend.

Metric	Value (FY2025 Est.)	Value (2024 Reported)
Segment Revenue (USD Billion)	$6.1 Billion	$5.8 billion
Segment Revenue Share	24%	25%

The segment's adjusted EBITA swung to a profit of SEK 0.2 billion in Q1 2025.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Key Resources

You're looking at the core assets Telefonaktiebolaget LM Ericsson (publ) relies on to compete in the global telecom space. These aren't just line items on a balance sheet; they are the engines driving future revenue, especially in areas like network programmability and cloud communications.

The foundation of Telefonaktiebolaget LM Ericsson (publ)'s competitive moat is its massive investment in innovation, which translates directly into intellectual property. This IP portfolio is critical for maintaining licensing revenue and defending its core network infrastructure business.

• Extensive Intellectual Property (IP) portfolio of over 57,000 granted patents.
• The company holds the inventor status for Bluetooth technology.

The strategic acquisition of Vonage created the Global Communications Platform (GCP), a key resource for expanding into the enterprise segment by offering network APIs to developers. This move was a significant capital deployment, with the transaction price set at approximately USD 6.2 billion. The expected payoff from this integration is material, with revenue synergy opportunities estimated to contribute USD 0.4 billion by 2025 through cross-selling the combined portfolio.

Sustaining this IP and platform requires continuous, heavy investment in research and development. For the twelve months ending September 30, 2025, the actual R&D expense was reported at USD 4.897 billion. This commitment is what keeps Telefonaktiebolaget LM Ericsson (publ) at the forefront of 5G and future network standards. The company is focused on making its Open RAN-ready portfolio AI native and hardware agnostic.

The operational capability to design, produce, and deploy complex network hardware globally is another non-negotiable resource. This is supported by a large, specialized workforce. As of the latest interim report in 2025, the total global headcount stood at 89,898 employees. A significant portion of this talent is dedicated to future development, with 26,744 employees listed as R&D staff as of December 31, 2024.

Here's a quick look at the scale of the talent pool and its recent trend:

Metric	Value	Date/Period
Total Employees Worldwide	89,898	Latest Interim Report 2025
R&D Employees	26,744	December 31, 2024
Total Granted Patents	57,000+	Current Portfolio Size
LTM R&D Expense	USD 4.897 billion	Ending September 30, 2025

The global supply chain and manufacturing footprint are essential for delivering the physical network infrastructure that underpins their services. This physical capability is complemented by the specialized engineering and software talent required to manage and evolve the software-defined network elements. For instance, the Cloud Software and Services segment saw organic sales grow by 9% in Q3 2025, showing the value derived from this specialized software expertise.

• Global supply chain supports network hardware deployment worldwide.
• Highly specialized engineering and software talent drives core and cloud segments.
• The company secured an 8-year partnership with Vodafone-3 in the U.K. to supply a significant majority of the mobile networks and the entire core network.

Finance: draft 13-week cash view by Friday.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Value Propositions

You're looking at the core value Ericsson is delivering to its Communication Service Provider (CSP) customers as of late 2025. It's all about performance, programmability, and operational intelligence, which is how they maintain their leadership position.

The foundation of the value proposition rests on industry-leading 5G network performance and reliability. Independent analysis confirms this leadership; the Omdia Market Landscape RAN Vendors report for 2025 ranked Telefonaktiebolaget LM Ericsson (publ) as the top vendor in both business performance and portfolio. This isn't just talk; their 5G contracts account for 35% of the global market, which helped drive a 10% rise in operating profit year-on-year in Q1 2025. To be fair, their 5G market share outside of China was approximately 36% in 2024, and they have worked to strengthen that position throughout 2025. More than 50% of worldwide 5G traffic outside China is running on their equipment. Here's a quick look at their scale:

Metric	Value
5G Contracts Global Market Share	35%
5G Market Share (Outside China, 2024 Est.)	Approx. 36%
Live 5G Standalone (SA) Networks Powered	42 of 70+
5G Networks Running on Ericsson Innovation	189 of ~340

Next, you see the push for programmable networks, which lets CSPs offer differentiated connectivity and unlock new use cases. This architectural shift is happening now; the company projects that more than two-thirds of its radio product deliveries in 2025 will support these open and programmable networks. They are on track to offer 130 radio products to support these networks during 2025. This programmability is directly translating into new revenue streams; as of late 2025, there are 65 commercial offerings based on network slicing across 33 CSPs, with 21 of those offerings launched in 2025 alone. That's rapid monetization, you see.

Energy efficiency is a major component of the value, helping customers manage operational costs and sustainability targets. The stated goal was to reduce the energy consumption of typical new radio base station sites by 40% between 2021 and 2025. While the final verified data for the 2025 target is pending audit, new radio innovations are already delivering significant gains. For instance, new Massive MIMO radios can cut energy consumption by up to 30 per cent and reduce embodied carbon footprint by up to 50 per cent. Plus, streamlined supply chain and logistics practices annually avoid almost 23,000 metric tons of carbon emissions.

The move to cloud-based communication and API platforms is about making network capabilities accessible to enterprise developers. Telefonaktiebolaget LM Ericsson (publ) is accelerating this via a strategic partnership, including a minority stake acquisition in LotusFlare, which has 500 employees globally. This effort, combined with their Vonage cloud communications platform, aims to expose and monetize advanced network capabilities via APIs. They also launched Ericsson On-Demand, a true software-as-a-service (SaaS) platform for core network services, designed with Google Cloud. This model helps CSPs provision services in minutes rather than months, which is a huge step up from traditional deployment cycles.

Finally, AI-driven autonomous network management is central to operational efficiency. They are embedding AI into their products; for example, using an AI model on link adaptation shows a potential spectral gain of 10%. The industry recognizes this shift; forecasts show the network-automation segment rising towards USD 11 billion in 2025. This intelligence is already showing results in trials, such as Chunghwa Telecom deploying digital twins and generative models that lifted event capacity by 14 percent. Still, the industry is early in this journey; less than 10% of CSPs are barely reaching Level 3 autonomy, which is the point where AI integration into network operation systems truly begins to take hold.

• New radio products designed to reduce energy consumption by up to 30%.
• AI model application showing a potential spectral gain of 10%.
• 21 new commercial offerings based on network slicing launched in 2025 alone.
• The network-automation segment is forecast to rise towards USD 11 billion in 2025.
• Ericsson's core network services are offered as a SaaS platform, allowing provisioning in minutes.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Customer Relationships

Long-term, strategic account management for major CSPs

• Ericsson supports 187 live 5G networks in 78 countries as of late 2025.
• Over 40 of these live 5G networks are 5G Standalone (SA) deployments.
• Ericsson has 70+ live cloud-native core deployments across 180 countries.
• North America represented 35% of total sales by Q2 2025.
• North America sales surged by 54% year-on-year in Q4 2024.

Dedicated support and customized pricing for complex network deployments

The five-year, $14 billion contract signed with AT&T in late 2023 is a key example of a strategic, long-term deployment commitment. This contributed to North America revenues reaching SEK 20.4 billion ($2 billion) in Q3 2024.

Metric	Value	Context
AT&T Contract Value	$14 billion	Long-term strategic CSP agreement
North America Sales % of Total (Q2 2025)	35%	Regional contribution
North America Revenue Growth (Q4 2024 YoY)	54%	Impact of strategic deployment spending

Self-service and API documentation for developers on the Vonage platform

Telefonaktiebolaget LM Ericsson (publ) (ERIC) expects meaningful network API revenue during 2025. The Vonage platform is embraced by a 1.1 million global developer community. Vonage maintains back-end connections across over 200 CSPs. As of December 2025, Vonage Communications APIs and Network APIs are available in AWS Marketplace.

Simplified, incentivized channel partner program for Enterprise sales

The new Enterprise Wireless Solutions Partner Programme officially became active on July 1, 2025, replacing the previous multi-tiered structure. The program features three core categories: Solution Partners, Distribution-managed Partners, and Ecosystem member partners. The program rollout includes the launch of Partner View, a dashboard for performance metrics.

• New program structure aims for better earning potential and simplified operations.
• Solution Partners invest in sales and technical certifications.
• The Mountaineer program, focused on training-based certifications, is now open to all registered partners.

Co-creation and joint innovation initiatives with key partners like stc

On December 3, 2025, Telefonaktiebolaget LM Ericsson (publ) (ERIC) announced a strategic partnership with LotusFlare, which included the acquisition of a minority stake. This alliance, alongside Aduna (launched September 2024), focuses on providing common solution blueprints for a Network API Exposure Layer. The goal is to accelerate CSPs' ability to unlock new network capabilities.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Channels

You're looking at how Telefonaktiebolaget LM Ericsson (publ) gets its technology-from massive core network gear to enterprise software-into the hands of customers. It's a multi-pronged approach, balancing direct, high-touch sales with a vast partner ecosystem. Considering the TTM revenue hit SEK 240.31 billion as of September 30, 2025, the scale of these channels is significant.

Direct Sales force for large-scale network infrastructure contracts (CSPs)

The bedrock of Telefonaktiebolaget LM Ericsson (publ)'s channel strategy remains the direct sales force targeting Communication Service Providers (CSPs). This team handles the large-scale, complex infrastructure contracts that form the core business. This is where you see the impact of their leadership in 5G infrastructure; for instance, Telefonaktiebolaget LM Ericsson (publ) currently powers 42 of the world's 70+ commercially live 5G Standalone (SA) networks. The North American market, a key focus area, represented 35% of total sales by Q2 2025.

Enterprise Wireless Solutions Partner Programme (resellers, MSPs)

For the growing Enterprise segment, Telefonaktiebolaget LM Ericsson (publ) relies heavily on its revamped Solutions Partner Programme, which went live on July 1, 2025, simplifying the previous tiered structure. This channel is crucial, as the enterprise side of the business sees around a 95/5 split, meaning 95% of its business flows through partners versus direct sales. The program now clearly defines three categories:

• Solution partners: Resellers investing in sales and technical certifications.
• Distribution-managed partners: Supported programmatically via authorized distributors.
• Ecosystem member partners: Including Managed Service Providers (MSPs) and technology alliance players.

The financial incentives were recalibrated to drive specific behaviors. The deal registration discount was increased to 15% from a previous 5% base, with the ultimate goal being for partners to make right around 20% margin working with Telefonaktiebolaget LM Ericsson (publ).

Vonage/Global Communications Platform for direct API consumption

The push into software and developer services is channeled through the Global Communications Platform, anchored by the Vonage business, which Telefonaktiebolaget LM Ericsson (publ) acquired for $6.2 billion. The strategy here is direct consumption by developers and enterprises building applications using network APIs. Telefonaktiebolaget LM Ericsson (publ)'s CEO had previously indicated expectations for meaningful API revenue starting in 2025. This aligns with the broader market, where the global Network API Market size was valued at USD 1.63 billion in 2025. The company is accelerating this by leveraging its Vonage division and a minority stake in LotusFlare to enhance the supply of APIs, aiming to boost consumption of new network capabilities.

Ericsson Federal Technologies Group for US public sector sales

To specifically address the US public sector, Telefonaktiebolaget LM Ericsson (publ) established the Ericsson Federal Technologies Group (EFTG) in March 2024. This entity focuses on accelerating digital modernization for state and federal agencies, including the Department of Defense (DoD). As of early 2024, Telefonaktiebolaget LM Ericsson (publ) equipment was already part of about 50% of the DoD's 5G deployments. EFTG ensures compliance with requirements like Foreign Ownership Control or Influence (FOCI) Mitigation to secure sensitive government work.

Authorized distributors and system integrators for enterprise hardware

Beyond the dedicated Enterprise Wireless Solutions Partner Programme, the broader hardware and system integration landscape remains a key channel. The global telecommunication system integration market itself was estimated to be a $50 billion market in 2025. While the 95/5 partner-to-direct split mentioned earlier pertains to the Enterprise segment specifically, authorized distributors and system integrators are essential for scaling the deployment and integration of Telefonaktiebolaget LM Ericsson (publ)'s core network and enterprise hardware solutions across various geographies and customer types.

Here's a snapshot of the scale and recent channel focus:

Channel Focus Area	Relevant Metric/Data Point	Value/Amount
Overall Scale (TTM)	Total Reported Revenue (Net Sales) as of September 30, 2025	SEK 240.31 billion
Direct Sales (CSPs)	Number of commercially live 5G SA networks powered	42 (out of 70+)
Enterprise Partner Program	Deal Registration Discount Increase (New vs. Old)	15% vs. 5%
Enterprise Partner Program	Targeted Partner Margin	Around 20%
Vonage/APIs	Acquisition Cost of Vonage	$6.2bn
Vonage/APIs	Estimated Network API Market Size in 2025	USD 1.63 Billion
Ericsson Federal Technologies Group	Approximate share of DoD 5G deployments using Ericsson equipment	50%
System Integration Market Context	Estimated Global Telecom System Integration Market in 2025	$50 billion

The new Partner View digital tool helps Solution Partners monitor performance metrics like revenue and pipeline data, meaning less time chasing data. Finance: draft 13-week cash view by Friday.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Customer Segments

You're looking at the core customer base for Telefonaktiebolaget LM Ericsson (publ) as of late 2025. This isn't just about selling radios; it's about selling the entire digital plumbing for the next decade.

Global Communication Service Providers (CSPs) like AT&T, Vodafone, China Mobile

CSPs remain the bedrock. Their investment cycles dictate the health of the Networks segment, which was 63% of net sales in Q3 2025. For the twelve months ending September 30, 2025, Telefonaktiebolaget LM Ericsson (publ) reported total revenue of SEK 240.31 billion. In Q3 2025 specifically, the Networks segment sales were SEK 35.4 billion. The focus here is on 5G Standalone (5G SA) monetization; as of November 2025, more than 90 CSPs have launched or soft-launched 5G SA networks. This move enables new value, evidenced by 65 commercial offerings based on network slicing across 33 CSPs, with 21 of those offerings launched in 2025 alone. The US market is a massive component, accounting for a stunning 44% of Ericsson's Q2 2025 sales, though the Americas region overall represented 35% of Q3 2025 net sales. Globally, 5G subscription uptake is strong, with the total expected to reach 2.9 billion by the end of 2025.

Here's a snapshot of the scale with the major CSP-facing unit:

Metric	Value (Q3 2025)	Context/Source
Networks Segment Sales	SEK 35.4 billion	Reported sales for the quarter.
Networks Segment Share of Net Sales	63%	Percentage of total Q3 2025 net sales.
Global 5G Contract Market Share	35%	Ericsson's share of the global 5G contracts.
5G SA Commercial Offerings	65	Total commercial offerings based on network slicing.
Total 5G Subscriptions (End of 2025 Est.)	2.9 billion	Global estimate for year-end 2025.

Enterprise sector (e.g., manufacturing, utilities) seeking Private 5G and Wireless WAN

The Enterprise segment is a strategic growth area, though it faced headwinds recently. In Q3 2025, this segment represented 9% of sales and saw an organic sales decline of 7%. Still, the Enterprise Wireless Solutions unit, which handles Private 5G and Cradlepoint products, showed strong momentum in early 2025, with reported sales growing by 20% year-on-year in Q1 2025. For the full year 2024, this enterprise wireless division contributed SEK 4.9 billion to sales, a 17% increase from 2023. The division's revenue in Q2 2025 stood at SEK 5.5 billion ($570 million). This group is focused on delivering high-quality, low-latency connectivity for industrial use cases.

Developers and businesses consuming network APIs (via Vonage)

The acquisition of Vonage feeds directly into this segment, aiming to monetize network capabilities via APIs. The overall Communications Platform as a Service (CPaaS) market is projected to reach USD 22 billion by 2025, with expectations for the segment to grow at 30% annually. Ericsson had projected revenue synergies from Vonage of USD 0.4 billion by 2025. More recent analyst expectations cited a 17% growth for the CPaaS business up to 2025, with a Total Addressable Market (TAM) of USD 69 billion. However, the Business Area Global Communications Platform (BGCP), which includes Vonage, saw sales decline by 9% organically in Q3 2025. In that quarter, Vonage's sales were SEK 3.2 billion ($330 million), accompanied by a loss widening by 50% to SEK 600 million ($63 million). Vonage serves a community of more than one million registered developers.

US Federal Government and Public Sector entities

While specific government contract revenue isn't broken out, this customer base is captured within the significant North American sales figures. The Americas region represented 35% of Telefonaktiebolaget LM Ericsson (publ)'s net sales in Q3 2025. North America is a key strategic priority market.

Handset manufacturers (for Intellectual Property Rights licensing)

This group provides a source of high-margin, recurring revenue through IPR (Intellectual Property Rights) licensing. In Q3 2025, IPR revenue was SEK 3.1 billion. This figure represented a year-over-year decline of SEK 0.4 billion compared to Q3 2024.

Finance: draft 13-week cash view by Friday.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Cost Structure

You're looking at the core expenses Telefonaktiebolaget LM Ericsson (publ) incurs to keep the lights on and the networks running. Honestly, for a company this size, the cost structure is dominated by a few massive buckets, primarily R&D and the actual cost of the hardware they sell.

High R&D costs are non-negotiable to stay ahead in the telecom game. To maintain technology leadership, Telefonaktiebolaget LM Ericsson (publ) is pouring significant capital into innovation. The research and development expenses for the twelve months ending September 30, 2025, clocked in at $4.897B. This aligns closely with the internal target of annual investments exceeding SEK 50 billion in R&D, which supports their portfolio of over 60,000 granted patents.

The Cost of Goods Sold (COGS) represents the direct cost tied to their hardware sales, which is a huge chunk of the total outlay. For the twelve months ending September 30, 2025, the Cost of Goods Sold for hardware manufacturing and supply chain logistics totaled $12.571B. This figure reflects the ongoing costs associated with producing and delivering network equipment and related services.

Personnel costs are being actively managed through workforce adjustments. Telefonaktiebolaget LM Ericsson (publ) has been executing a global restructuring plan, aiming to cut approximately 8,500 jobs worldwide to streamline operations. While the prompt mentioned 6,000 reductions, the broader plan targets 8,500. As a concrete example of the financial impact, restructuring charges were estimated at SEK 4 billion for 2024, and Q2 2025 results suggested these charges would remain high as the company continued its efficiency drive.

Sales, General, and Administrative (SG&A) expenses cover the overhead of running a global operation. For the twelve months ending September 30, 2025, SG&A expenses were reported at $3.483B. This is down from the 2024 annual figure of $4.887B, suggesting some success in controlling these operational costs as part of the broader cost-cutting strategy.

Finally, Intellectual Property Rights (IPR) litigation and licensing costs are a recurring, albeit variable, expense. While settlements bring in revenue, the legal battles themselves are costly. For instance, the partial settlement with Lenovo in Q2 2025 led to the withdrawal of all ongoing lawsuits, including actions before the United States International Trade Commission (USITC), with financial impacts recognized starting in Q2 2025. This shows that resolving disputes, even partially, is a major financial event.

Here's a quick look at some of the key cost components based on the latest available data:

Cost Component	Latest Reported Amount	Period/Context
Cost of Goods Sold (COGS)	$12.571B	Twelve Months Ending September 30, 2025
Research & Development (R&D) Expenses	$4.897B	Twelve Months Ending September 30, 2025
SG&A Expenses	$3.483B	Twelve Months Ending September 30, 2025
Restructuring Charges	SEK 4 billion	Estimated for Fiscal Year 2024
Global Job Reduction Target	Around 8,500 employees	Global Restructuring Plan

The cost structure is heavily weighted toward product delivery and future technology development. You can see the focus on efficiency in the reduction of SG&A relative to the LTM COGS, but the R&D spend remains high to protect their market position.

• R&D expenses averaged $4.906 billion from fiscal years ending December 2020 to 2024.
• The company is confident in growing IPR revenues following new 5G agreements.
• Q2 2025 adjusted gross margin reached 48.0%, supported by lower operating expenses.
• The company has structurally lowered its cost base.

Finance: draft 13-week cash view by Friday.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Canvas Business Model: Revenue Streams

You're looking at the core ways Telefonaktiebolaget LM Ericsson (publ) brings in cash as we move through late 2025. It's a mix of big hardware sales, recurring software/service fees, and the often-lumpy but important income from its patent portfolio.

The bulk of the revenue still comes from the foundational network infrastructure business, but the shift toward software and services is definitely visible in the projections.

Revenue Stream Category	Projected 2025 Revenue (USD)	Approximate Share of Total Projected Revenue
Networks segment sales (equipment and services)	$16 Billion	64%
Cloud Software and Services sales	$6.1 Billion	24.4%
Enterprise and Other sales (including Vonage)	$2.6 Billion	10.4%
Total Projected Revenue (FY2025)	$25 Billion	100%

The Networks segment remains the single-biggest revenue driver, projected to account for about 65% of the total projected $25 Billion in revenues for Fiscal Year 2025. That segment delivers the products and services needed for mobile and fixed communication, covering several generations of radio and transmission networks.

Intellectual Property Rights (IPR) licensing fees from handset makers contribute significantly, often bolstered by one-time settlements. For instance, IPR licensing revenues in the fourth quarter of 2024 reached SEK 3.5 billion. A portion of this IPR income, specifically 82%, is reported within the Networks segment, with the rest falling under Cloud Software and Services.

Here's a quick look at the components driving the Cloud Software and Services and Enterprise streams, which rely heavily on recurring or service-based revenue models:

• Cloud Software and Services sales are projected at $6.1 Billion for 2025.
• Enterprise and Other sales, which include the Vonage operation, are projected at $2.6 Billion.
• The Enterprise segment includes Enterprise Wireless Solutions, covering private networks and wireless wide-area network (WWAN) solutions.
• The Global Communications Platform within Enterprise includes cloud-based Unified Communications as a Service offerings.
• Early revenues are emerging from the programmable network ecosystem, specifically from the Aduna network API initiative.

The move toward subscription-based models for software and managed services is a strategic focus point. This is evident in the composition of the Cloud Software and Services segment, which provides solutions for core networks and business/operational support systems. Furthermore, the Enterprise segment is pushing cloud-based services like Contact Center as a Service and Communications Platform as a Service.

Revenue Type Detail	Latest Reported Data Point/Context
IPR Licensing Revenue (Latest Specific Figure)	SEK 3.5 billion (Q4 2024)
Cloud Software & Services (Managed Services)	Provides managed network services.
Enterprise (UCaaS/CCaaS/CPaaS)	Includes cloud-based Unified Communications as a Service.
Enterprise (Private Networks)	Growth area for Enterprise Wireless Solutions.

The company reported a net income of SEK 4.6 billion in Q2 2025, which benefited from higher IPR licensing revenues following a settlement. Finance: draft 13-week cash view by Friday.