Ericsson seeks network business growth but is cautious about rising costs.

Ericsson expects its growth to be faster than the network market, despite the company reporting a decline in sales in North America in the first quarter and warning that component costs are rising. The Swedish telecom equipment company said on Friday that its key network business achieved a 7% organic sales growth in the quarter, with the decline in sales in North America offset by growth in most other regions. The company continues to expect the network market to remain roughly flat this year but is confident in surpassing the industry's growth. CEO Brje Ekholm stated that the company's investments in building a strong and diversified supply chain have helped it continue to deliver products to customers amidst geopolitical and macroeconomic uncertainty, but he cautioned that component prices are rising. "We are facing challenges with rising input costs, especially in the semiconductor field, partly due to demand for AI. Our goal is to offset these challenges through close collaboration with customers and suppliers, as well as through product substitution and efficiency actions." The company reported a first-quarter profit before interest and taxes of 1.44 billion Swedish kronor, lower than 5.93 billion Swedish kronor in the same period last year, dragged down by unfavorable exchange rates and restructuring charges.