Ericsson Q2 profit beats forecast

STOCKHOLM: Ericsson, the world's largest supplier of mobile phone network equipment, reported second quarter earnings and operating margins above forecasts.

Ericsson's second quarter sales were 44.17 billion crowns versus a forecast 44.79 billion. Second quarter operating margin
was 18.7 percent, versus a forecast 17.4 percent.

Ericsson spokesman Henry Stenson said the group had been able to boost its second quarter operating margin from the first
quarter's 16.9 percent due to three factors, including a solid performance from mobile phone group Sony Ericsson, which
Ericsson half-owns with Japan's Sony.

Ericsson CEO Carl-Henric Svanberg said in a statement that Ericsson remained well positioned to win market share.

Second quarter gross margin came in at 42 percent, slightly below the 42.7 percent average forecast and down from 45.9
percent in the same period of 2005.

"It is a totally okay report. Sales were a little worse than expected, while operating margin was much better. On the whole
it is a mixed report, but acceptable," said SEB Asset Management analyst Johan Strandberg.