ERIC 20-F
Ericsson Lm Telephone Co (ERIC)
Table of Contents
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Title of each class |
Trading symbol(s) |
Name of each exchange on which registered | ||
B Shares * |
| * | Not for trading, but only in connection with the registration of the American Depositary Shares representing such B Shares pursuant to the requirements of the Securities and Exchange Commission. |
B shares (SEK 5.00 nominal value) |
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A shares (SEK 5.00 nominal value) |
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C shares (SEK 5.00 nominal value) |
| ☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer |
☐ | Emerging growth company |
report.
☐ |
U.S. GAAP | ☒ | ☐ | Other | ||||||
| International Accounting Standards Board |
Table of Contents
TABLE OF CONTENTS
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Table of Contents
ii
Table of Contents
PART I
INTRODUCTION
Unless otherwise indicated, all references herein to “Ericsson,” the “Company,” the “Group,” “we,” “us,” “our” or “our company” are references to Telefonaktiebolaget LM Ericsson and its consolidated subsidiaries.
This document is our Annual Report on Form 20-F for the year ended December 31, 2025 (the “2025 Form 20-F”). Reference is made to the English version of our Swedish Annual Report for 2025, with certain adjustments made to comply with U.S. requirements, which is attached hereto as Exhibit 15.1 (the “2025 Swedish Annual Report (adjusted version)”). Only (i) the information included in this 2025 Form 20-F, (ii) the information in the 2025 Swedish Annual Report (adjusted version) that is incorporated by reference in this 2025 Form 20-F, and (iii) the exhibits to the 2025 Form 20-F that are required to be filed pursuant to the Form 20-F shall be deemed to be filed with the Securities and Exchange Commission (the “SEC”) for any purpose, including incorporation by reference into any document filed by us pursuant to the Securities Act of 1933, as amended, which incorporates by reference the 2025 Form 20-F. Any information in the 2025 Swedish Annual Report (adjusted version) that is not referenced in this 2025 Form 20-F or filed as an exhibit thereto shall not be deemed to be so incorporated by reference. Certain industry, technical and financial terms used in this 2025 Form 20-F are defined in the subsections entitled “Glossary” and “Financial terminology” of the 2025 Swedish Annual Report (adjusted version), which are incorporated herein by reference.
Market data and certain industry forecasts used herein were obtained from internal surveys, market research, publicly available information and industry publications. While we believe that the market research, publicly available information and industry publications we use are reliable, we have not independently verified market and industry data from third-party sources. Moreover, while we believe our internal surveys are reliable, they have not been verified by any independent source.
The information included on http://www.ericsson.com/ and other websites that appear in this 2025 Form 20-F is not incorporated by reference herein. From time to time, we may use our website as a channel of distribution of material Company information. Financial and other material information regarding our company is routinely posted on and accessible at http://www.ericsson.com/.
Forward-Looking Statements
This 2025 Form 20-F includes forward-looking statements, including statements reflecting the Company’s current views relating to the growth of the market, future market conditions, future events, financial condition, and expected operational and financial performance, including, in particular the following:
– Potential material additional liability resulting from past conduct, including allegations of past conduct that remains unresolved or unknown in multiple jurisdictions, including Iraq, which remains the subject of ongoing investigations by Ericsson and U.S. governmental authorities.
– Risks related to internal controls and governance, including the potential to incur material liability in connection with internal controls surrounding payments made to third parties in connection with past conduct in multiple jurisdictions, including Iraq, which remains the subject of ongoing investigations by Ericsson and U.S. governmental authorities.
– The risk that the ongoing investigations by Ericsson and U.S. governmental authorities result in a conclusion by Ericsson or U.S. governmental authorities that the Company’s past conduct included making or having responsibility for making payments to a terrorist organization or other improper payments, which could lead to material additional liability.
– Risks related to the Company’s ongoing compliance with obligations under the National Security Agreement entered into in connection with Ericsson’s acquisition of Vonage Holdings Corp. (“Vonage”), which may adversely affect the Vonage business and subject the Company to additional liabilities.
– Ericsson’s goals, strategies, planning assumptions and operational or financial performance expectations.
– Macroeconomic conditions, including inflationary pressures and effects on customer investments, market recovery and growth.
– Ongoing geopolitical and trade uncertainty, including challenging global economic conditions, market trends and the imposition of tariffs and sanctions.
– Continued growth of mobile communications, the success of Ericsson’s existing and targeted customer base, and Ericsson’s ability to maintain technology leadership.
– Success in implementing key strategies, including improving profitability, leading in 6G, capturing 5G market opportunities, capitalizing on network API and Enterprise opportunities, incorporation of AI technologies into certain products, services and processes, and expected benefits from restructuring activities.
– Risks related to cybersecurity and privacy, security and data localization.
– Industry trends, future characteristics and development of the markets in which Ericsson operates.
– Risks of global operations, including legal and regulatory requirements and uncertainties, and unfavorable lawsuits and legal proceedings.
– Ericsson’s future liquidity, capital resources, capital expenditures, cost savings and profitability, and risks related to financial condition.
– The expected demand for Ericsson’s existing and new products and services as well as plans to launch new products and services, including research and development expenditures.
– Ericsson’s ability to deliver on future plans and achieve future growth.
– The expected operational or financial performance of strategic cooperation activities and joint ventures.
– Risks related to acquisitions and divestments that may be disruptive and incur significant expenses, including Ericsson’s ability to successfully consummate such transactions, protect the value of acquisitions during integration, or achieve the value anticipated with an acquisition.
– Trends related to Ericsson’s industry, including Ericsson’s regulatory environment, competition and customer structure.
– Intense competition from existing competitors, and new entrants, including vendor consolidation.
– Limited number of third-party suppliers, large, multi-year agreements with limited number of key customers, and operator consolidation.
– Risks related to intellectual property, key employees, and unforeseen risks and disruptions due to natural or man-made events.
– Risks related to environmental, social, governance, diversity, equity and inclusion and business conduct.
– Other factors included in Ericsson’s filings with the SEC, including the factors described throughout this report, included in the section Risk Factors, as updated by subsequent reports filed with the SEC.
The words ”believe,” ”expect,” ”foresee,” ”anticipate,” ”assume,” ”intend,” ”likely,” ”projects,” ”may,” ”could,” ”plan,” ”estimate,” ”forecast,” ”will,” ”should,” ”would,” ”predict,” ”aim,” ”ambition,” ”seek,” ”potential,” ”target,” ”might,” ”continue,” or, in each case, their negative or variations, and similar words or expressions are used to identify forward- looking statements. Any statement that refers to the Company’s strategy, future financial performance, expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Such statements are based on management’s expectations as of the date of this report, unless an earlier date is specified, including expectations based on third-party information and projections that management believes to be reputable.
Ericsson cautions investors that these statements are subject to risks and uncertainties many of which are difficult to predict and generally beyond Ericsson’s control that could cause actual results to differ materially and adversely from those expressed in, or implied or projected by, the forward-looking information and statements. Important factors that could affect whether and to what extent any of Ericsson’s forward-looking statements materialize include but are not limited to the factors described throughout this 2025 Form 20-F, including in the section Risk factors. These forward-looking statements also represent Ericsson’s estimates, assumptions and expectations only as of the date that they were made, and to the extent they represent third-party data, Ericsson has not undertaken to independently verify such third-party data and do not intend to do so.
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Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this 2025 Form 20-F and in other documents Ericsson files from time to time with Ericsson’s regulators that disclose risks and uncertainties that may affect Ericsson’s business. Unless specifically indicated otherwise, the forward-looking statements in this 2025 Form 20-F do not reflect the potential impact of any divestitures, mergers, acquisitions, or other business combinations that have not been completed as of the date of this report. Ericsson expressly disclaims a duty to provide updates to these forward-looking statements, and the estimates and assumptions associated with them, after the date of this 2025 Form 20-F, to reflect events or changes in circumstances or changes in expectations or the occurrence of anticipated events, whether as a result of new information, future events or otherwise, except as required by applicable law or stock exchange regulation. This 2025 Form 20-F includes websites or references to additional company reports. These are intended to provide inactive, textual references only.
The information on websites and contained in those reports is not part of this report and not incorporated by reference in this report. This 2025 Form 20-F contains statements based on hypothetical scenarios and assumptions as well as estimates that are subject to a high level of uncertainty, and these statements should not necessarily be viewed as being representative of current or actual risk or performance, or forecasts of expected risk or performance. In addition, historical, current, and forward-looking environmental and social-related statements may be based on standards for measuring progress that are still developing and on internal controls and processes that continue to evolve. While certain matters discussed in this 2025 Form 20-F may be significant, any significance should not be taken, or otherwise assumed, as necessarily rising to the level of materiality used for purposes of complying with Ericsson’s public company reporting obligations pursuant to the U.S. federal securities laws and regulations, even if the report uses the words “material” or “materiality.”
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3. KEY INFORMATION
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors
The information set forth under the heading “Financial Report – Risk factors” of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
ITEM 4. INFORMATION ON THE COMPANY
A. History and Development of the Company
General facts on the company
Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).
Organization number: 556016-0680
Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.
Country of incorporation: Sweden.
Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.
Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.
Telephone number: +46 10 719 0000
Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.
In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.
Agent in the US: Ericsson Inc., 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.
Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (“ADS”), each representing one underlying Class B share, are traded on NASDAQ New York.
Parent Company operations: The business of the Parent Company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions internal banking activities and customer credit management.
Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Shares owned directly by the Parent Company” in Item 4.C. below. We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3.D. Risk Factors.”
Company history and development
Innovating to empower people, business and society
Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and other electrical and mechanical equipment. Shortly thereafter, the Company began manufacturing its first telephones.
Ericsson is a leading provider of mobile connectivity solutions to communications service providers, enterprises and the public sector. The Company’s portfolio spans the following segments: Networks, Cloud Software and Services and Enterprise (which includes Global Communications Platform, Wireless Wide Area Networks and private 5G networks). In addition, segment Other consists of media businesses and other non-allocated businesses. Ericsson delivers high-performing, programmable and energy-efficient networks that enable greater service differentiation. Ericsson’s enterprise solutions provide superior connectivity to businesses and advanced network capabilities to application developers.
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The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | This is Ericsson |
| • | Strategy |
| • | Leading mobile networks to drive an AI-powered world |
| • | Leadership in mobile networks |
| • | Scaling the mobile platform |
| • | Strategic foundation |
| • | 150 years of connectivity |
| • | Board of Directors’ Report |
| • | Financial highlights – Capital expenditure |
For capital expenditures, we typically use available cash from operations.
| • | Notes to the consolidated financial statements |
| • | Note E2 – Business combinations |
| • | Note H6 – Events after the reporting period |
B. Business Overview
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | This is Ericsson |
| • | Strategy |
| • | Leading mobile networks to drive an AI-powered world |
| • | Leadership in mobile networks |
| • | Scaling the mobile platform |
| • | Strategic foundation |
| • | 150 years of connectivity |
| • | Board of Directors’ Report |
| • | Financial highlights – Research and Development (R&D) expenses |
| • | Financial highlights – Seasonality |
| • | Business results – Segments |
| • | Business results – Market areas |
Ericsson’s value chain spans the extraction and processing of raw materials used in electronic components to the delivery of communication services for end users. It comprises five main stages: global electronics manufacturing, direct suppliers, own operations, direct customers, and consumers and end users.
As is typical for large multinational companies, Ericsson’s value chain is complex and interconnected, which creates challenges for visibility and traceability beyond the first tier of suppliers and customers. In 2025, the Company had approximately 15,000 active direct suppliers, of which approximately 200 provided materials and components used in Ericsson’s hardware.
The global electronics manufacturing value chain begins with the extraction of natural resources used in electronic hardware. These materials are refined, traded and manufactured into parts and components that are assembled into finished products. Ericsson’s regional supply hubs consolidate material from component suppliers and distribute it to production sites. Ericsson’s supply and component hubs are located in Sweden, Belgium, Germany, The Netherlands, the United States, Mexico, the United Arab Emirates, India, Malaysia, Singapore and China.
| • | Notes to the consolidated financial statements |
| • | Note B1 – Segment information |
| • | Risk factors |
| • | Risks related to business activities and industry |
| • | Risks related to Ericsson’s financial condition |
| • | Risks related to legal and regulatory matters |
| • | Risks related to cybersecurity matters |
| • | Risks related to environmental, social and business conduct matters |
| • | Corporate Governance Report |
| • | Regulation |
Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 (“ITRA”)
In 2018, Ericsson initiated its wind down in Iran, and, in 2025, had no business engagements in Iran. Ericsson is continuing its efforts to liquidate its local legal entity, in accordance with applicable sanctions and local law requirements. Ericsson does not normally allocate gross revenue or net income on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, in 2025, Ericsson has estimated that its gross revenue and net profits attributable to Iran were negligible.
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Before 2018, Ericsson had arranged performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson had entered into relating to the business in Iran. In such instances, Ericsson usually engaged its banks outside Iran, who in turn engaged local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, the performance bonds have been frozen by the EU banks. One local performance bond for the local legal entity has been renewed with Saman Bank. Existing bank guarantees issued to Ericsson by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations related to earlier business engagements were renewed.
C. Organizational Structure
The following list shows certain shareholdings owned directly and indirectly by our Parent Company as of December 31, 2025. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.
Shares owned directly by the Parent Company
| Company |
Reg. No. | Domicile | Percentage of ownership |
Par value in local currency, million |
Carrying value, SEK million |
|||||||||||
| Subsidiary companies |
||||||||||||||||
| Ericsson AB |
556056-6258 | Sweden | 100 | 50 | 20,731 | |||||||||||
| Ericsson Shared Services AB |
556251-3266 | Sweden | 100 | 361 | 2,216 | |||||||||||
| Red Bee Media Holding AB |
559113-9729 | Sweden | 100 | — | 773 | |||||||||||
| Ericsson Insurance (Försäkring) AB |
516406-0534 | Sweden | 100 | 50 | 469 | |||||||||||
| Datacenter i Rosersberg AB |
556895-3748 | Sweden | 100 | — | 74 | |||||||||||
| Datacenter i Mjärdevi Aktiebolag |
556366-2302 | Sweden | 100 | 10 | 69 | |||||||||||
| Ericsson Mobile Financial Services AB |
559335-5059 | Sweden | 100 | — | 15 | |||||||||||
| Ericsson Software Technology Holding AB |
559094-8963 | Sweden | 100 | — | 7 | |||||||||||
| Aktiebolaget Aulis |
556030-9899 | Sweden | 100 | 14 | 6 | |||||||||||
| Other (Sweden) |
— | — | 374 | |||||||||||||
| Ericsson S.A/N.V. |
Belgium | 100 | 5 | 119 | ||||||||||||
| Ericsson Danmark A/S |
Denmark | 100 | 90 | 216 | ||||||||||||
| Oy LM Ericsson Ab |
Finland | 100 | 13 | 196 | ||||||||||||
| Ericsson France SAS |
France | 100 | 21 | 524 | ||||||||||||
| Ericsson Germany GmbH |
Germany | 100 | 1 | 1,816 | ||||||||||||
| Ericsson Hungary Ltd. |
Hungary | 100 | 1,301 | 120 | ||||||||||||
| Ericsson Telecomunicazioni S.p.A. |
Italy | 100 | 44 | 2,429 | ||||||||||||
| Ericsson Holding International B.V. |
Netherlands | 100 | 222 | 2,983 | ||||||||||||
| Ericsson A/S |
Norway | 100 | 75 | 257 | ||||||||||||
| Ericsson Sp. z o.o. |
Poland | 100 | 4 | 412 | ||||||||||||
| Ericsson Telecomunicacoes LDA. |
Portugal | 100 | 1 | 23 | ||||||||||||
| Ericsson Antenna Technology Romania S.R.L. |
Romania | 100 | 98 | 206 | ||||||||||||
| Ericsson Telecommunications Romania S.R.L. |
Romania | 100 | 49 | 103 | ||||||||||||
| Ericsson España S.A.U |
Spain | 100 | 28 | 14 | ||||||||||||
| Ericsson Ltd. |
United Kingdom | 100 | 53 | 1,663 | ||||||||||||
| Other (Europe, excluding Sweden) |
— | — | 255 | |||||||||||||
| Ericsson Canada Inc. |
Canada | 100 | — | 221 | ||||||||||||
| Ericsson Holding II Inc. |
United States | 100 | — | 34,295 | ||||||||||||
| Ericsson Smart Factory Inc. |
United States | 100 | — | 424 | ||||||||||||
| Ericsson Global Network Platform Holding Inc. |
United States | 100 | — | 18,701 | ||||||||||||
| Ericsson de Colombia S.A.S |
Colombia | 100 | 701 | 178 | ||||||||||||
| Ericsson Antenna Technology Mexico S.A. de C.V. |
Mexico | 100 | 589 | 239 | ||||||||||||
| Ericsson Telecom S.A. de C.V. |
Mexico | 100 | 1,439 | 576 | ||||||||||||
| Other (Americas) |
— | — | 232 | |||||||||||||
| Teleric Pty Ltd. |
Australia | 100 | 20 | 100 | ||||||||||||
| Ericsson (China) Company Ltd. |
China | 100 | 65 | 475 | ||||||||||||
| P.T. Ericsson Indonesia |
Indonesia | 95 | 9,531 | 614 | ||||||||||||
| Ericsson India Private Limited |
India | 100 | 291 | 51 | ||||||||||||
| Ericsson Korea Partners Co., Ltd. |
Korea, Republic of | 75 | 285 | 2,087 | ||||||||||||
| Ericsson (Malaysia) Sdn. Bhd. |
Malaysia | 100 | 3 | 131 | ||||||||||||
| Ericsson South Africa (Pty.) Ltd |
South Africa | 70 | — | 94 | ||||||||||||
| Ericsson Taiwan Ltd. |
Taiwan | 90 | 270 | 36 | ||||||||||||
| Ericsson (Thailand) Ltd. |
Thailand | 49 | (1) | 90 | 17 | |||||||||||
| Ericsson Telekomünikasyon A.Ş. |
Turkey | 100 | 5 | 150 | ||||||||||||
| Other (the rest of the world) |
— | — | 463 | |||||||||||||
| Total |
95,154 | |||||||||||||||
| Associated companies |
||||||||||||||||
| Leone Media Inc. |
United States | 46 | 134 | — | ||||||||||||
| Ericsson Nikola Tesla d.d. |
Croatia | 49 | 65 | 330 | ||||||||||||
| Total |
330 | |||||||||||||||
| 1) | Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd. |
Shares owned by subsidiary companies
| Company |
Reg. No. |
Domicile |
Percentage | |||
| Subsidiary companies |
||||||
| Ericsson Facilities GmbH |
Germany | 100 | ||||
| Ericsson GmbH |
Germany | 100 | ||||
| Ericsson Telecommunicatie B.V. |
Netherlands | 100 | ||||
| Red Bee Media Limited |
United Kingdom | 100 | ||||
| Ericsson Inc. |
United States | 100 | ||||
| Vonage Holdings Corp. |
United States | 100 | ||||
| Ericsson Enterprise Wireless Solutions Inc. |
United States | 100 | ||||
| Ericsson Telecomunicações LTDA. |
Brazil | 100 | ||||
| Ericsson Australia Pty. Ltd. |
Australia | 100 | ||||
| Ericsson (China) Communications Co. Ltd. |
China | 100 | ||||
| Nanjing Ericsson Panda Communication Co. Ltd. |
China | 100 | ||||
| Ericsson Japan K.K. |
Japan | 100 |
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D. Property, Plants and Equipment
Primary manufacturing and assembly facilities
We continuously adjust our production capacity to meet expected customer demand. We consider the production capacity of our manufacturing network to be sufficient to meet the requirements of our business. The extent of utilization of our manufacturing facilities varies from plant to plant and from time to time during the year. None of these facilities is subject to a material encumbrance.
The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.
| 2025 | 2024 | 2023 | ||||||||||||||||||||||
| Sites |
Thousands |
Sites |
Thousands |
Sites |
Thousands |
|||||||||||||||||||
| Sweden |
1 | 3.7 | 1 | 5 | 1 | 5 | ||||||||||||||||||
| China |
1 | 10.4 | 1 | 10.4 | 1 | 13.9 | ||||||||||||||||||
| Estonia |
1 | 9 | 1 | 9 | 1 | 9 | ||||||||||||||||||
| Brazil |
1 | 8.3 | 1 | 8.3 | 1 | 7 | ||||||||||||||||||
| United States |
1 | 10.3 | 1 | 10.1 | 1 | 9 | ||||||||||||||||||
| Romania |
1 | 9 | 1 | 9 | 1 | 10 | ||||||||||||||||||
| Mexico |
1 | 7.5 | 1 | 7.5 | 1 | 7.5 | ||||||||||||||||||
| Total |
7 | 58.20 | 7 | 59.0 | 7 | 61.0 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| * | Floor space in square meters does not include any warehouses or transportation areas. |
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Financial highlights – Capital expenditure |
| • | Notes to the consolidated financial statements |
| • | Note C2 – Property, plant and equipment |
| • | Note C3 – Leases |
| • | Risk factors |
| • | Risks related to legal and regulatory matters |
| • | Risks related to environmental, social and business conduct matters |
ITEM 4A. Unresolved Staff Comments
None.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
Year-to-year comparisons between 2024 and 2023 have been omitted from this 2025 Form 20-F but may be found in “Item 5. Operating and Financial Review and Prospects” in our Annual Report on Form 20-F for the fiscal year ended December 31, 2024.
A. Operating Results
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | This is Ericsson |
| • | Strategy |
| • | Leading mobile networks to drive an AI-powered world |
| • | Leadership in mobile networks |
| • | Scaling the mobile platform |
| • | Strategic foundation |
| • | Board of Directors’ Report |
| • | Financial highlights |
| • | Business results – Segments |
| • | Business results – Market areas |
| • | Corporate Governance – Risk management |
| • | Notes to the consolidated financial statements |
| • | Note A1 – Material accounting policies |
| • | Note F1 – Financial risk management |
| • | Risk Factors |
| • | Alternative performance measures |
| • | Corporate Governance Report |
| • | Regulation |
B. Liquidity and Capital Resources
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Financial highlights – Cash flow |
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| • | Financial highlights – Financial position |
| • | Financial highlights – Seasonality |
| • | Financial highlights – Capital expenditure |
| • | Notes to the consolidated financial statements |
| • | Note B9 – Other current liabilities |
| • | Note D1 – Provisions |
| • | Note D2 – Contingent liabilities |
| • | Note D4 – Contractual obligations |
| • | Note F1 – Financial risk management |
| • | Note F4 – Interest-bearing liabilities |
| • | Note H3 – Statement of cash flows |
| • | Shareholder information |
| • | Capital allocation |
C. Research and Development, Patents and Licenses, etc.
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Strategy |
| • | Leading mobile networks to drive an AI-powered world |
| • | Leadership in mobile networks |
| • | Scaling the mobile platform |
| • | Strategic foundation |
| • | Risk factors – Risks related to business activities and industry |
| • | Board of Directors’ Report |
| • | Financial highlights – Research and Development (R&D) expenses |
Ericsson has a policy of strong commitment to research and development (“R&D”) with substantial contributions to cutting-edge open standards and technologies, leading the development of cellular technology – from 2G to 5G and beyond. Our strong R&D investments position us to further extend our technology leadership for cost performance and sustainability. It is Ericsson’s policy to protect and capitalize on our R&D investments by creating, securing, protecting, and licensing a portfolio of patents in support of our overall business goals. Our patent portfolio comprises more than 60,000 granted patents, which are licensed globally on fair, reasonable and nondiscriminatory terms to the users of our technology.
With high-performing programmable networks, enabled by open ecosystems, development tools, interfaces and technologies and cloud, Ericsson collaborates with our partners and customers to drive the future of connectivity, enabling programmability and delivering unparalleled user experiences. Our technology leadership is critical in enabling these networks, and today around 50% of the world’s mobile 5G traffic excluding China is carried over Ericsson’s radio networks. Within Enterprise, Ericsson is increasing investments in developing network APIs. Other areas of focus in R&D include the capability of networks to handle gigabytes per second more efficiently, using more automation, using Artificial Intelligence to improve network performance and reducing energy consumption, while securing sustainability leadership to support customers to lower the total cost of ownership and meet net zero requirements.
Research and Development and Patent Information
| 2025 | 2024 | 2023 | ||||||||||
| R&D expenses SEK bn |
48.9 | 53.5 | 50.7 | |||||||||
| Patents |
over 60,000 | over 60,000 | over 60,000 | |||||||||
D. Trend Information
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | CEO Comment – Positioned for growth |
| • | Board of Directors’ Report |
| • | Financial highlights – Seasonality |
| • | Business results – Segments |
| • | Business results – Market areas |
E. Critical accounting estimates
| • | Financial Report |
| • | Notes to the consolidated financial statements |
| • | Note A2 – Judgments and critical accounting estimates |
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Corporate Governance Report |
| • | Members of the Board of Directors |
| • | Members of the Executive Team as of December 31, 2025 |
| • | Financial Report |
| • | Notes to the consolidated financial statements |
| • | Note G3 – Share-based compensation |
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B. Compensation
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Guidelines for remuneration to Group management approved by the Annual General Meeting of shareholders 2023 |
| • | Notes to the consolidated financial statements |
| • | Note G1 – Post-employment benefits |
| • | Note G2 – Information regarding members of the Board of Directors and Group management |
| • | Note G3 – Share-based compensation |
| • | Corporate Governance Report |
| • | Remuneration to Board members |
| • | Remuneration Report |
| • | Remuneration Report 2025 |
C. Board Practices
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Notes to the consolidated financial statements |
| • | Note G2 – Information regarding members of the Board of Directors and Group management – Comments to the table |
| • | Corporate Governance Report |
| • | Board of Directors – Composition of the Board of Directors |
| • | Committees of the Board of Directors – Audit and Compliance Committee |
| • | Committees of the Board of Directors – Remuneration Committee |
D. Employees
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Financial highlights – Employees |
| • | Notes to the Consolidated financial statements |
| • | Note G4 – Employee information |
We believe that we have a good relationship with the labor unions that represent our employees.
Number of employees by market area at year-end
| 2025 | 2024 2) | 2023 2) | ||||||||||
| Americas |
15,050 | 16,034 | 17,285 | |||||||||
| Europe, Middle East and Africa 1) |
39,045 | 41,387 | 43,320 | |||||||||
| South East Asia, Oceania and India |
25,189 | 26,389 | 27,016 | |||||||||
| North East Asia |
9,542 | 10,426 | 12,331 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total |
88,826 | 94,326 | 99,952 | |||||||||
|
|
|
|
|
|
|
|||||||
| 1) of which in Sweden |
12,806 | 13,420 | 13,977 | |||||||||
2) 2024 and 2023 have been restated to reflect the changes in the market area structure implemented in 2025, see note B1 “Segment Information” of the 2025 Swedish Annual Report (adjusted version) for more information.
E. Share Ownership
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | The Ericsson share – Shareholders |
| • | Notes to the consolidated financial statements |
| • | Note G2 – Information regarding members of the Board of Directors and Group management |
| • | Corporate Governance Report |
| • | Members of the Board of Directors |
| • | Members of the Executive Team as of December 31, 2025 |
| • | Remuneration Report |
| • | Remuneration Report 2025 |
F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation
Not applicable.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A. Major Shareholders
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
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| • | The Ericsson Share – Shareholders |
| • | Corporate Governance Report |
| • | Governance structure – Ownership structure |
B. Related Party Transactions
The information set forth under the following heading of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
| • | Financial Report |
| • | Notes to the consolidated financial statements |
| • | Note H4 – Related party transactions |
| • | Note G2 – Information regarding members of the Board of Directors and Group management |
C. Interests of Experts and Counsel.
Not applicable.
ITEM 8. FINANCIAL INFORMATION
A. Consolidated Statements and Other Financial Information.
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Legal proceedings involving governmental authorities |
| • | Legal proceedings not involving governmental authorities |
| • | Proposed disposition of earnings |
| • | Consolidated financial statements |
| • | Notes to the consolidated financial statements |
| • | Reports of independent registered public accounting firm |
See Item 10.B. “Additional Information – Memorandum and Articles of Association” and Item 17. “Financial Statements” herein.
B. Significant Changes
Ericsson announces a proposed staff reduction in Sweden
On January 15, 2026, Ericsson announced a proposed headcount reduction in Sweden. Ericsson has submitted a notice to the Swedish Public Employment Service. Approximately 1,600 positions could be impacted in Sweden.
Ericsson’s Board of Directors proposes a share buyback program
On January 23, 2026, Ericsson announced that a share buyback program for up to SEK 15 billion will be proposed to the AGM by the Board of Directors. For more information, see 2025 Swedish Annual Report (adjusted version), Financial Report, Notes to the consolidated financial statements, Note E1 ”Equity”.
ITEM 9. THE OFFER AND LISTING
A. Offer and Listing Details
The information set forth in Exhibit 2.3, “Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934” is incorporated herein by reference.
B. Plan of Distribution
Not applicable.
C. Markets
The information set forth in Exhibit 2.3, “Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934” is incorporated herein by reference.
D. Selling Shareholders
Not applicable.
E. Dilution
Not applicable.
F. Expenses of the Issue
Not applicable.
ITEM 10. ADDITIONAL INFORMATION
A. Share Capital
Not applicable.
B. Memorandum and Articles of Association
The information set forth in Exhibit 2.3, “Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934” is incorporated herein by reference.
C. Material Contracts
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
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| • | Financial Report |
| • | Board of Directors’ Report |
| • | Corporate governance – Material contracts |
• Notes to the consolidated financial statements
• Note E2 – Business combinations
D. Exchange Controls
There is no Swedish legislation affecting the import or export of capital or the remittance of dividends, interest or other payments to non-resident holders of our securities, except that, subject to the provisions in any tax treaty, dividends are subject to withholding tax.
E. Taxation
General
The taxation discussion set forth below does not purport to be a complete analysis or listing of all potential tax effects relevant to the acquisition, ownership or disposition of Class B shares or ADSs. The statements of United States and Swedish tax laws set forth below are based on the laws in force as of the date of this report and may be subject to any changes in United States or Swedish law, and in any double taxation convention or treaty between the United States and Sweden, occurring after that date, which changes may then have a retroactive effect.
Specific tax provisions may apply for certain categories of taxpayers. Your tax treatment if you are a holder of Class B shares or ADSs depends in part on your particular situation. If you are a holder of Class B shares or ADSs, you should, therefore, consult a tax advisor as to the tax consequences relating to your particular circumstances resulting from the ownership of Class B shares or ADSs.
The tax consequences to holders of ADSs, as discussed below, apply equally to holders of Class B shares.
Certain Swedish Tax Considerations
This section describes the material Swedish income tax consequences for a holder of ADSs or Class B shares who is not considered to be a Swedish resident for Swedish tax purposes. This section applies to you only if you are a holder of portfolio investments representing less than 10% of capital and votes and is not applicable if the ADSs or Class B shares pertain to a permanent establishment or fixed place of business in Sweden.
Taxation on Capital Gains
Generally, non-residents of Sweden are not liable for Swedish capital gains taxation with respect to the sale of ADSs or Class B shares. However, under Swedish tax law, capital gains from the sale of shares in Swedish companies and certain other securities by an individual may be taxed in Sweden at a rate of 30% if the seller has been a resident of Sweden or has lived permanently in Sweden at any time during the year of the sale or the 10 calendar years preceding the year of the sale (absent treaty provisions to the contrary). The provision is applicable to ADSs or Class B shares and also applies to shares in foreign companies, provided that the shares were acquired during the time that the person was liable to tax in Sweden.
This provision may, however, be limited by tax treaties that Sweden has concluded with other countries. Under the tax treaty between Sweden and the United States (the “U.S. Tax Treaty”), this provision applies for ten years from the date the individual ceased to be a resident of Sweden.
Taxation on Dividends
A Swedish dividend withholding tax at a rate of 30% is imposed on dividends paid by a Swedish corporation, such as us, to non-residents of Sweden. The same withholding tax applies to certain other payments made by a Swedish corporation, including payments as a result of redemption of shares and repurchase of stock through an offer directed to its shareholders. Exemption from the withholding tax or a lower tax rate may apply by virtue of a tax treaty. Under the U.S. Tax Treaty, the withholding tax on dividends paid on portfolio investments to eligible U.S. holders is reduced to 15%.
Under all Swedish tax treaties, except the tax treaty with Switzerland, withholding tax at the applicable treaty rate should be withheld by the payer of the dividends. With regard to dividends paid from shares in corporations registered with the Euroclear Sweden (such as our shares), a reduced rate of dividend withholding tax under a tax treaty is generally applied at the source by the Euroclear Sweden or, if the shares are registered with a nominee, the nominee, as long as the person entitled to the dividend is registered as a non-resident and sufficient information regarding the tax residency of the beneficial owner is available to the Euroclear Sweden or the nominee.
In those cases where Swedish withholding tax is withheld at the rate of 30% and the person who received the dividends is entitled to a reduced rate of withholding tax under a tax treaty, a refund may be claimed from the Swedish tax authorities before the end of the fifth calendar year following the year that the distribution was made.
Certain United States Federal Income Tax Consequences
The following discussion is a summary of the material United States federal income tax consequences relevant to the ownership and disposition of ADSs or Class B shares. This discussion is based on the tax laws of the United States (including the Internal Revenue Code of 1986, as amended (the “Code”), its legislative history, existing and proposed U.S. Treasury regulations thereunder, published rulings and court decisions) as in effect on the date hereof, all of which are subject to change, possibly with retroactive effect. The discussion is not a full discussion of all tax considerations that may be relevant to the ownership and disposition of ADSs or Class B shares and does not address the Medicare tax on net investment income or the effects of any state, local or non-U.S. tax laws. The discussion applies only if you hold the ADSs and/or the Class B shares as capital assets and you use the USD as your functional currency. It does not deal with the tax treatment of investors subject to special rules, such as grantor trusts, real estate investment trusts, regulated investment companies, banks, brokers or dealers in securities or currencies, traders in securities that elect to use a mark-to-market method of recording for their securities holdings, financial institutions, insurance companies, persons required to accelerate the recognition of any item of gross income with respect to our ADSs or Class B shares as a result of such income being recognized on an applicable financial statement, tax-exempt entities, investors liable for alternative minimum tax, holders (either actually or constructively) of 10% or more of the voting power or the value of our shares, persons holding ADSs and/or Class B shares as part of a hedging, straddle, conversion or constructive sale transaction and persons who are resident or ordinarily resident in Sweden. In addition, investors holding ADSs and/or Class B shares indirectly through partnerships are subject to special rules not discussed below. You should consult your tax advisors about the United States federal, state, local and non-U.S. tax consequences to you of the ownership and disposition of the ADSs or Class B shares.
The discussion below is not binding on the U.S. Internal Revenue Service (the “IRS”) or any court. Therefore, we can provide no assurance that the United States federal income tax consequences discussed below will not be challenged by the IRS or will be sustained by a court if challenged by the IRS.
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The discussion below applies to you only if you are a beneficial owner of ADSs and/or Class B shares not resident in Sweden for purposes of the U.S. Tax Treaty and you are, for United States federal income tax purposes, (1) a citizen or resident of the United States, (2) a corporation or any other entity treated as a corporation that is organized in or under the laws of the United States or its political subdivisions, including the District of Columbia, (3) a trust if all of the trust’s substantial decisions are subject to the control of one or more United States persons and the primary supervision of the trust is subject to a United States court, or if a valid election is in effect with respect to the trust to be taxed as a United States person, or (4) an estate the income of which is subject to United States federal income taxation regardless of its source.
The discussion below assumes that the representations contained in the deposit agreement governing the ADSs are true and that the obligations in the deposit agreement and any related agreement will be complied with in accordance with the terms. If you hold ADSs, you are expected to be treated as the holder of the underlying Class B shares represented by those ADSs for United States federal income tax purposes. The remainder of this discussion assumes that a holder of ADSs will be treated in this manner.
Dividends
Subject to the passive foreign investment company rules discussed below, the gross amount of distributions paid (before reduction for any Swedish withholding taxes) with respect to the ADSs or Class B shares generally will be included in your gross income as ordinary income from foreign sources to the extent paid out of our current or accumulated earnings and profits (as determined for United States federal income tax purposes). Distributions in excess of earnings and profits will be treated as a non-taxable return of capital to the extent of your adjusted tax basis in the ADSs or Class B shares and thereafter as capital gain. Because we do not maintain calculations of our earning and profits under United States federal income tax principles, you should expect all distributions will be reported as dividends for United States federal income tax purposes. The dividends will not be eligible for the dividends received deduction available to corporations in respect of dividends received from other U.S. corporations. The amount of any distribution paid in SEK will be the USD value of the distribution payment based on the spot rate of exchange in effect on the date of receipt (or constructive receipt) by you, in the case of Class B shares, or by the depositary, in the case of ADSs, whether or not the payment is converted into USD at that time. Your tax basis in the SEK received will equal such USD amount. Gain or loss, if any, recognized on a subsequent sale or conversion of the SEK will be U.S. source ordinary income or loss.
If you are a non-corporate holder of ADSs or Class B shares, dividends you receive on the ADSs or Class B shares may be taxed at the lower applicable long-term capital gains rate provided that (1) we are not a passive foreign investment company (as discussed below) for either our taxable year in which the dividend was paid or the preceding taxable year, (2) certain holding period requirements are met, (3) you are not under any obligation to make related payments with respect to substantially similar or related property and (4) either (a) in the case of ADSs our ADSs continue to be listed on the NASDAQ Stock Market (or a national securities exchange that is registered under section 6 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) or (b) we are eligible for the benefits of the U.S. Tax Treaty. You should consult your tax advisors regarding the availability of the lower rate for dividends paid with respect to ADSs or Class B shares.
Subject to certain limitations, you will generally be entitled to receive credit against your United States federal income tax liability (or a deduction against your United States federal taxable income) with respect to any Swedish tax withheld in accordance with the U.S. Tax Treaty and paid over to Sweden. If a refund of the tax withheld is available to you under the laws of Sweden or under the U.S. Tax Treaty, the amount of tax withheld that is refundable will not be eligible for such credit against your United States federal income tax liability (and will not be eligible for the deduction in computing your United States federal taxable income). For foreign tax credit limitation purposes, dividends will be income from sources without the United States, and will generally be treated as “passive category income” (or, in the case of certain holders, “general category income”). There are significant and complex limits on your ability to claim foreign tax credits. Certain U.S. Treasury Regulations that apply to non-U.S. income taxes paid or accrued in taxable years beginning on or after December 28, 2021 further restrict the ability of any such credit based on the nature of the tax imposed by the non-U.S. jurisdiction, such as Sweden, although the IRS has provided temporary relief from the application of certain aspects of these regulations until new guidance or regulations are issued. You should consult your tax advisors regarding the creditability or deductibility of any withholding taxes.
Sale or Exchange of ADSs or Class B shares
Subject to the passive foreign investment company rules discussed below, you will generally recognize capital gain or loss on the sale or other disposition of the ADSs or Class B shares equal to the difference between the USD value of the amount realized and your adjusted tax basis (determined in USD) in the ADSs or Class B shares. Such gain or loss will generally be long-term capital gain or loss if you have held the ADSs or Class B shares for more than one year, and will generally be treated as arising from U.S. sources for foreign tax credit limitation purposes. If you are a non-corporate holder of ADSs or Class B Shares, long-term capital gains are eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations.
The amount realized on a disposition of ADSs or Class B shares for cash will generally be the amount of cash you receive for the ADSs or Class B shares (which, in the case of payment in a non-U.S. currency, will equal the USD value of the payment received generally determined on the date of disposition). If the ADSs or Class B shares are treated as traded on an “established securities market” for United States federal income tax purposes and you are a cash basis taxpayer or an accrual basis taxpayer making a special election (which must be applied consistently from year to year and cannot be changed without the consent of the IRS), you will determine the USD value of the amount realized by translating the amount received at the spot rate of exchange on the settlement date of the sale.
If you are an accrual basis taxpayer and do not make the special election, you will recognize exchange gain or loss to the extent attributable to the difference between the exchange rates on the trade date and the settlement date, and such exchange gain or loss will be U.S. source ordinary income or loss.
Your initial tax basis in ADSs or Class B shares generally will equal the cost of such ADSs or Class B shares. If you used non-U.S. currency to purchase ADSs or Class B shares, the cost of such ADSs or Class B shares generally will be the USD value of the non-U.S. currency purchase price on the date of purchase, translated at the spot rate of exchange on that date. If ADSs or Class B shares are treated as traded on an “established securities market” for United States federal income tax purposes and you are a cash basis taxpayer or an accrual basis taxpayer making a special election (which must be applied consistently from year to year and cannot be changed without the consent of the IRS), you will determine the USD value of the cost of such ADSs or Class B shares by translating the amount paid at the spot rate of exchange on the settlement date of purchase.
Passive Foreign Investment Company Status
A non-U.S. corporation is a passive foreign investment company (a “PFIC”) in any taxable year in which, after taking into account the income and assets of certain subsidiaries, either (a) at least 75% of its gross income is passive income or (b) at least 50% of the quarterly average value of its assets is attributable to assets that produce or are held to produce passive income. For this purpose, passive income includes interest, dividends, gains from transactions in commodities (other than certain active business gains from the sale of commodities) and other investment income, with certain exceptions. The PFIC rules also contain a look-through rule whereby we will be treated as owning our proportionate share of the gross assets and earning our proportionate share of the gross income of any other corporation in which we own, directly or indirectly, 25% or more (by value) of the stock. Based on the market value of our shares, the composition of our assets and income and our operations, we believe we were not a PFIC during the year 2025. However, whether or not we will be considered a PFIC will depend on the nature and source of our income and the composition and value of our assets, as determined from time to time. There can be no assurance that we will not be a PFIC for current or future taxable years. If we are treated as a PFIC, we will not provide information necessary for the “qualified electing fund” election as the term is defined in the relevant provisions of the Code. You should consult your tax advisors about the consequences of our potential classification as a PFIC.
If we were classified as a PFIC with respect to your ADSs or Class B shares for any taxable year, we would generally continue to be a PFIC (unless certain conditions are met), and you would be subject to special rules with respect to:
| • | any gain realized on the sale or other disposition of ADSs or Class B shares; or |
| • | any other “excess distribution” made to you (generally, any distributions to you in respect of ADSs or Class B shares during a single taxable year |
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| that are, in the aggregate, greater than 125% of the average annual distributions received by you in respect of ADSs or Class B shares during the three preceding taxable years or, if shorter, your holding period for ADSs or Class B shares). |
Under these rules:
| • | the gain or any other excess distribution would be allocated ratably over your holding period for ADSs or Class B shares; |
| • | the amount allocated to the taxable year in which the gain or excess distribution was realized and any year before we became a PFIC would be taxable as ordinary income; |
| • | the amount allocated to each prior year, other than the current year and any taxable year prior to the first taxable year in which we were a PFIC, would be subject to tax at the highest applicable marginal tax rate in effect for each such year; and |
| • | an interest charge would be imposed. |
If we are a PFIC for any taxable year, you will also be deemed to own shares in any of our subsidiaries that are also PFICs in such a year. As an alternative to the special rules described above, holders of “marketable stock” in a PFIC may elect mark-to-market treatment with respect to their ADSs or Class B shares. ADSs or Class B shares will not be considered marketable stock unless they are regularly traded on a qualified exchange or other market. If the mark-to-market election is available and you elect mark-to-market treatment you will, in general, include as ordinary income each year an amount equal to the increase in value of your ADSs or Class B shares for that year (measured at the close of your taxable year) and will generally be allowed a deduction for any decrease in the value of your ADSs or Class B shares for the year but only to the extent of previously included mark-to-market income. In addition, any gain you recognize upon the sale or other disposition of the ADSs or Class B shares will be treated as ordinary income and any loss will be treated as ordinary loss but only to the extent of previously included mark-to-market income. Any loss in excess of previously included mark-to-market income will be treated as a capital loss. However, a mark-to-market election would likely be unavailable with respect to your proportionate share in any of our subsidiaries that are PFICs.
If you own ADSs or Class B shares during any year in which we are a PFIC, you will generally be required to make an annual return on IRS Form 8621.
Information Reporting and Backup Withholding
In general, information reporting requirements will apply to dividends paid in respect of ADSs or Class B shares and the proceeds received on the sale or exchange of the ADSs or Class B shares within the United States or by a broker with certain United States connections. Backup withholding may apply to payments to you of dividends paid in respect of ADSs or Class B shares or the proceeds of a sale or other disposition of ADSs or Class B shares if you fail to provide an accurate taxpayer identification number (certified on IRS Form W–9) or, upon request, to certify that you are not subject to backup withholding or otherwise to comply with the applicable requirements of the backup withholding rules. Backup withholding is not an additional tax. The amount of any backup withholding from a payment to you will be allowed as a credit against your United States federal income tax liability, and a refund of any excess amount withheld under the backup withholding rules may be obtained by filing the appropriate claim for refund with the Internal Revenue Service and furnishing any required information.
Additional Reporting Requirements
Certain holders who are individuals (and certain entities) that hold an interest in “specified foreign financial assets” (which may include ADSs and/or Class B shares) are required to report information relating to such assets, subject to certain exceptions (including an exception for ADSs or Class B shares held in accounts maintained by certain financial institutions). Substantial penalties can apply if you are such a holder and fail to satisfy such reporting requirements. You should consult your tax advisors regarding the effects, if any, of these requirements on your ownership and disposition of ADSs or Class B shares.
F. Dividends and Paying Agents
Not applicable.
G. Statement by Experts
Not applicable.
H. Documents on Display
Annual reports and other information are filed with, or furnished to, the SEC in the United States, pursuant to the rules and regulations that apply to foreign private issuers. Electronic access to these documents may be obtained from the SEC’s website, www.sec.gov where they are stored in the EDGAR database.
I. Subsidiary Information
See Item 4.C. “Information on the Company – Organizational Structure.”
J. Annual Report to Security Holders
Not applicable.
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
A. Quantitative Information about Market Risk
The information set forth under the following heading of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Corporate Governance -– Risk management |
| • | Notes to the consolidated financial statements |
| • | Note F1 – Financial risk management |
B. Qualitative Information about Market Risk
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Financial Report |
| • | Board of Directors’ Report |
| • | Corporate Governance -– Risk management |
| • | Notes to the consolidated financial statements |
| • | Note F1 – Financial risk management |
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| • | Corporate Governance Report |
| • | Risk management |
C. Interim Periods
Not applicable.
D. Safe Harbor
Not applicable.
E. Smaller Reporting Companies
Not applicable.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
A. Debt Securities
Not applicable.
B. Warrants and Rights
Not applicable.
C. Other Securities
Not applicable.
D. American Depositary Shares
Depositary fees, charges and payments
During 2025, an annual service fee of $0.02 was charged per ADS, for the operation and maintenance costs in administering the ADS program. The Depositary, Deutsche Bank Trust Company Americas (“Deutsche Bank”), established October 20, 2025 as the record date for payment of annual servicing fees. During 2025, an annual dividend fee of $0.01 was charged per ADS. The Depositary, Deutsche Bank, established March 27, 2025 and September 29, 2025 as the record dates for payments of the dividend fee.
Fees and charges payable by ADS holders
| Service |
Rate |
By whom paid | ||||
| 1) | Deposit of shares and issuance of receipts | Up to USD 5 per 100 American Depositary Shares or fraction thereof | Party to whom receipts are issued | |||
| 2) | Delivery of deposited shares against surrender of receipts | Up to USD 5 per 100 American Depositary Shares or fraction thereof | Party surrendering receipts | |||
| 3) | Processing of distribution of cash dividends and cash proceeds | Up to USD 3 per 100 American Depositary Shares | All ADS holders | |||
| 4) | Administration of the ADSs | Up to USD 3 per 100 American Depositary Shares per annum | All ADS holders |
In addition to the fees of the Depositary enumerated above, ADS holders are required under the terms of the deposit agreement to bear the following: (i) taxes and other governmental charges, (ii) share transfer registration fees on deposits, (iii) certain cable and facsimile transmission and delivery charges, and (iv) such expenses as are incurred by Deutsche Bank in the conversion of foreign currency into dollars.
Fees payable by the Depositary to the Company
Effective January 2019, Deutsche Bank agreed to pay Ericsson an amount equal to a fixed percentage of the net revenues, if any, collected by it as a result of charging ADS holders issuance and cancellation fees, and dividend processing and annual servicing fees. In 2025, such amount totaled approximately USD 12.6 million.
Effective January 2019, Deutsche Bank waived the cost of providing the ADS program administrative and reporting services to the extent provided by Deutsche Bank, and has agreed to bear the cost of certain third-party out-of-pocket costs related to the ADS program up to USD 50,000 per year. These costs include costs for the local custodian’s administration of matters relating to meetings of shareholders and costs of certain transfer agent administration services, such as the registration and transfer of depositary receipts. In 2025, such amount totaled approximately USD 72,000.
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PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
None.
ITEM 15. CONTROLS AND PROCEDURES
A. Disclosure Controls and Procedures
The information set forth under the following heading of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Corporate Governance Report |
| • | Internal Control over Financial Reporting – Disclosure controls and procedures |
B. Management’s Annual Report on Internal Control Over Financial Reporting
The information set forth under the section “Financial Report – Management’s report on internal control over financial reporting” of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
C. Attestation Report of the Registered Public Accounting Firm
The information set forth under the section “Financial Report – Report of independent registered public accounting firm” of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
D. Changes in Internal Control Over Financial Reporting
The information set forth under the section “Financial Report – Management’s report on internal control over financial reporting – Changes in internal control over financial reporting” of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
The information set forth under the following heading of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Corporate Governance Report |
| • | Committees of the Board of Directors |
| • | Audit and Compliance Committee – Members of the Audit and Compliance Committee |
ITEM 16B. CODE OF ETHICS
We have adopted a Code of Business Ethics applicable to executive officers, directors and all other employees. Our Code of Business Ethics is available on our website at https://www.ericsson.com/en/about-us/corporate-governance/code-of-ethics. The Company will promptly disclose to our shareholders, if required by applicable laws or stock exchange requirements, any amendments to or waivers from the Code of Business Ethics applicable to our directors or officers by posting such information on our website at https://www.ericsson.com/en/about-us/corporate-governance/code-of-ethics. No waivers were requested or given during 2025.
The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:
| • | Corporate Governance Report |
| • | Regulation |
| • | Ethics and Compliance |
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information set forth under the Section “Financial Report – Notes to the consolidated financial statements – Note H5 – Fees to auditors” of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference.
Audit and Compliance Committee Pre-Approval Policies and Procedures
The Audit and Compliance Committee reviews the scope and execution of audits to be performed by external and internal auditors and analyzes the results and costs of the audits performed. The Audit and Compliance Committee keeps the Board of Directors informed regarding the external and internal audit results, the reliability of the Company’s financial reporting and the auditors’ performance. It also makes recommendations to the Nomination Committee regarding the appointment of the external auditor by the Annual General Meeting and auditor remuneration. In order to ensure the external auditor’s independence, the Audit and Compliance Committee has established pre-approval policies and procedures for audit and non-audit related services to be performed by the external auditor. Pre-approval authority may not be delegated to management. The policies and procedures include a list of prohibited services, and audit and non-audit services that require pre-approval by the Audit and Compliance Committee. Such services fall into two broad categories:
| • | General pre-approval – certain services regarding taxes, transactions, risk management, business improvement, corporate finance, attestation and accounting services and the so-called general services (other than prohibited services) have received general pre-approval by the Audit and Compliance Committee, provided that the estimated fee for each project does not exceed SEK 1 million. In addition, non-audit services provided to the Group shall not exceed 70% of the average of the fees paid in the last three consecutive financial years for the statutory audits of the Group. The external auditor must advise the Audit and Compliance Committee with a quarterly summary of ongoing projects related to audit and non-audit services and an annual report of fees and expenses for all audit and non-audit services. |
| • | Specific pre-approval – all other non-audit services and services subject to general pre-approval exceeding SEK 1 million must receive specific pre-approval. The external auditor submits an application in writing to the Parent Company for final approval by the Audit and Compliance Committee, including a statement as to whether, in the view of the external auditor, the contemplated services are consistent with applicable rules on its independence. The Audit and Compliance Committee Chairman has the delegated authority for specific pre-approval in between Committee meetings, provided that the estimated fee in each case does not exceed SEK 2.5 million. The Audit and Compliance Committee Chairman or other member designated by the Audit and Compliance Committee reports any pre-approval to the Audit and Compliance Committee at its next meeting. |
All services provided in 2025 by the independent auditors were pre-approved in accordance with the pre-approval policies and procedures described above.
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ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
All members of the Audit Committee of a NASDAQ New York-listed company must be independent in accordance with NASDAQ New York and SEC rules. SEC Rule 10A-3(b)(1)(iv)(C) under the Exchange Act includes a specific exemption from these independence requirements for Audit Committee members of foreign private issuers who are non-executive employee representatives appointed to the Audit Committee pursuant to local law. The Company relies on this exemption, and does not consider that such reliance materially adversely affects the ability of the Audit and Compliance Committee to act independently or to satisfy other SEC requirements applicable to Audit Committees.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
None.
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
None.
ITEM 16G. CORPORATE GOVERNANCE
Ericsson, as a company whose shares are listed on NASDAQ New York, is subject to the listing requirements and certain of the corporate governance requirements of NASDAQ New York and to certain rules of the SEC.
Under NASDAQ New York rules, all members of the audit committee of a NASDAQ New York-listed company must be independent in accordance with SEC rules. SEC rules include a specific exemption from these independence requirements for an employee of a foreign private issuer who is not an executive officer if the employee is elected or named to the board of directors or audit committee pursuant to the issuer’s governing law or documents, or other home country legal or listing requirements. The Company relies on this exemption and does not consider that such reliance materially adversely affects the ability of the Audit and Compliance Committee to act independently or to satisfy other SEC requirements applicable to audit committees.
Under NASDAQ New York rules, Ericsson is permitted to follow home country practices in lieu of certain NASDAQ corporate governance requirements that would apply to U.S. companies listed on NASDAQ New York. The rules require disclosures regarding the ways in which Ericsson’s corporate governance practices differ from those required of US companies under the rules of NASDAQ New York.
These differences include the following:
| • | Employee representatives are appointed to Ericsson’s Board of Directors (the “Board”) and serve on Committees (including the Audit and Compliance Committee and the Remuneration Committee) in accordance with Swedish law. |
| • | Employee representatives on the Board and committees may attend all meetings of the Board and committees on which they serve (including those of the Audit and Compliance Committee and the Remuneration Committee) in accordance with Swedish law. |
| • | In accordance with Swedish market practices, the Nomination Committee is not fully comprised of Board members. In addition to the Chair of the Board, representatives of the four largest shareholders by voting power, as of March 31, 2025, are members of the current Nomination Committee. |
| • | The determination regarding independence of Board members is made by the Nomination Committee (instead of the Board) prior to the Annual General Meeting of Shareholders (“AGM”). Before the AGM 2025, the Nomination Committee determined that the following Board members were independent under all applicable independence requirements, including the NASDAQ New York rules: Jon Fredrik Baksaas, Jan Carlson, Eric A. Elzvik, Marachel Knight, Kristin S. Rinne, Jonas Synnergren and Christy Wyatt. When appointing members to the committees of the Board, the Board makes determinations regarding committee member independence. |
| • | The Board holds non-executive directors’ sessions but does not have regularly scheduled meetings with only independent directors present. |
| • | Under applicable Swedish rules, Ericsson is not required to publicly disclose the material terms of all agreements and arrangements between its directors or nominees for director and any person or entity (other than Ericsson) relating to compensation or other payment in connection with such person’s candidacy or service as a director of the company. |
| • | The external auditor is elected by the shareholders and is proposed by the Nomination Committee upon recommendation from the Audit and Compliance Committee. |
| • | NASDAQ New York rules applicable to U.S. companies require the consideration of six factors relating to the independence of compensation consultants, legal counsel or other advisers retained by compensation or remuneration committees. Consistent with Swedish practices, the Remuneration Committee’s procedures addressing independence of advisers do not expressly require the consideration of those six factors. |
| • | Ericsson does not solicit proxies for shareholder meetings, which is in accordance with Swedish practices and rules. However, the Board may collect proxies in accordance with the Articles of Association. |
| • | There are no minimum quorum requirements for shareholder meetings under Swedish law, except under certain limited circumstances. Certain resolutions requiring special quorums and majorities are described under Exhibit 2.3. |
| • | Some of the requirements addressed by NASDAQ New York rules are included in the Swedish Corporate Governance Code or the work procedure for the Board instead of committee charters. The work procedure establishes the attribution of various responsibilities among the Board, its committees and the President and CEO. The work procedure for the Board is reviewed, evaluated and amended as required or appropriate, and is adopted by the Board at least once a year. |
ITEM 16H. MINE SAFETY DISCLOSURE
Not applicable.
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
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| 1) | Maj. Gen. (Ret) Fredrik Robertsson serves as Ericsson’s Chief Security Officer and Head of Group Security. His diverse experience includes former roles at the Swedish Armed Forces Headquarters, such as Director of Plans, Chief Information Officer, and CISO, which included directing and developing the Swedish Armed Forces’ cyber capability and cyber defense. He holds a Master of Science degree in Political Science with a specialization in Security Studies. Additionally, Maj. Gen. (Ret) Robertsson serves as a board member for Sectra AB. |
| 2) | Mikko Karikytö is Ericsson’s Chief Product Security Officer and Head of Product Security and was previously Head of Network Security and Head of Product Security Incident Response Team. Additionally, Mr. Karikytö is |
| • | Consolidated income statement and Consolidated statement of comprehensive income (loss) |
| • | Consolidated balance sheet |
| • | Consolidated statement of cash flows |
| • | Consolidated statement of changes in equity |
| • | Notes to the consolidated financial statements |
| • | Reports of independent registered public accounting firm (Deloitte PCAOB ID: |
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ITEM 19. EXHIBITS
EXHIBIT INDEX
The agreements and other documents filed as exhibits to this 2025 Form 20-F are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by the registrant in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.
Securities Exhibit
| * | This certification will not be deemed “filed” for purposes of Section 18 of the Exchange Act (15 U.S.C. §78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Registrant specifically incorporates it by reference. |
| ** | Certain of the information included in Exhibit 15.1 is incorporated by reference into this 2025 Form 20-F, as specified elsewhere in this report, in accordance with Rule 12b-23(a)(3) of the Exchange Act. With the exception of the items so specified, the 2025 Swedish Annual Report is not deemed to be filed as part of this 2025 Form 20-F. |
| *** | In accordance with Rule 406T(b)(2) of Regulation S-T, such XBRL information will be furnished and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, will be deemed not filed for purposes of Section 18 of the Exchange Act, and otherwise will not be subject to liability under those sections. |
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SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on Form 20-F on its behalf.
| TELEFONAKTIEBOLAGET LM ERICSSON | ||
| By: |
/s/ JAKOB STENMARK | |
| Name: |
Jakob Stenmark | |
| Title: |
Head of Group Control | |
| By: | /s/ LARS SANDSTRÖM | |
| Name: | Lars Sandström | |
| Title: | Senior Vice President and Chief Financial Officer | |
Date March 12, 2026
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