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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
TECHNOLOGY
- Ericsson 28s are at their tightest levels against Nokia 28s since February, having outperformed by ~7bp since Ericsson reported on 12 July in a set of results that we read as stronger than Nokia’s results on 18 July (as was also the case in Q1).
- While both are facing top-line weakness on the back of low market spending in the telecoms sector, we prefer the Ericsson credit on better cash flow driven by better operational performance and WC optimisation, a more prudent financial policy with buyback/M&A news out of Nokia and what looks like a better strategic position for Ericsson in the US market.
- Ericsson, while still showing a 7% YoY revenue decline, managed to achieve strong beats elsewhere on the income statement and grow the net cash position (even when removing the impact of a sizeable one-off gain). FY guidance was maintained.
- Nokia, on the other hand, not only missed on the top-line with an 18% YoY decline (to the lowest quarterly figure since 2015) but also further down the income statement (a one-off AT&T settlement meant a technical op profit beat though it would have been a miss otherwise). The net cash position did grow as a result though not as much as Ericsson’s did. Buybacks were also accelerated while the management call implied additional buybacks to offset dilution on the Infinera deal. FY guidance was cut.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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