* Sales SEK 46.4 (49.2) b, down 4% for comparable units, down 12%
  currency adjusted
* Operating income 1) before JVs SEK 5.5 (5.6) b
* Operating margin 1) before JVs 11.7% (11.5%)
* Share in earnings from JVs 1) SEK -1.5 (0.0) b
* Income after financial items 1) SEK 4.0 (6.2) b
* Restructuring charges of SEK 2.7 (1.9) b, excl JV
* Net income SEK 0.8 (2.9) b
* Earnings per share SEK 0.25 (0.89)
* Cash flow  2) SEK 6.9 (2.7) b
1) Excluding restructuring charges
2) Excluding cash outlays for restructuring of SEK 1.2 (0.3) b and
dividend from Sony Ericsson of SEK 1.4 b in Q3 2008

CEO COMMENTS

"Sales of network equipment declined due to lower demand in the current tougher market environment. Despite lower volumes, Network margins remain stable. The strong development in Professional Services continued," says Carl-Henric Svanberg, President and CEO of Ericsson (NASDAQ: ERIC). "Our cost reduction activities are running ahead of plan with further opportunities for efficiency improvements and savings.

As commented on in previous reports, the economic climate affects the global mobile infrastructure market and the credit environment is still tight in several emerging markets. However, other markets, including the world's leading economies such as China, India, US and Japan show good development.

The technology shift from voice telephony to mobile broadband is ongoing. Mobile broadband users and traffic are increasing rapidly and will eventually connect billions of people to internet. With the shift follows the anticipated decline in GSM sales, accelerated by the current recession, which is not yet offset by the growth in mobile broadband.

Our services operation continues to show strong development. While managed services are often in focus, systems integration and consulting are increasingly important. Services margins are stable despite being negatively affected by the start up costs in the third quarter for the Sprint and Zain services contracts as well as the reduced scope and transformation costs for the renewed managed services agreement in Italy.

In late September, we were pleased to welcome the former Sprint employees into Ericsson, and we look forward to soon also welcome former Nortel employees. This, together with the major contract wins with Verizon, AT&T and Metro PCS in mobile and fixed broadband, makes Ericsson the leading provider of telecommunications technology and services in North America.

While the current economic environment affects all parts of society the longer-term fundamentals for our industry remain solid. Mobile telephony is reaching a penetration beyond all expectations. We expect mobile broadband to show a similar exciting development over the years to come, not least as the vast majority of the world's population will be able to reach internet only through mobile technology. We are well positioned to lead our industry forward," concludes Carl-Henric Svanberg.

FINANCIAL HIGHLIGHTS
INCOME STATEMENT AND CASH FLOW
                   Third quarter    Second quarter    Nine months
SEK b.            2009  2008 Change   2009  Change  2009  2008 Change
Net sales         46.4  49.2    -6%   52.1    -11% 148.1 141.9     4%
Net sales for
comparable units  46.4  48.2    -4%   52.1    -11% 148.1 137.8     7%
Gross margin     36.2% 37.0%      -  36.3%       - 36.3% 37.5%      -
EBITDA margin
excl JVs         15.8% 15.4%      -  16.8%       - 15.3% 14.3%      -
Operating income
excl JVs           5.5   5.6    -3%    6.9    -21%  17.1  13.7    25%
Operating margin
excl JVs         11.7% 11.5%      -  13.3%       - 11.5%  9.6%      -
Income after
financial items    4.0   6.2   -35%    4.8    -18%  12.2  15.3   -21%
Net income         0.8   2.9   -74%    0.8      0%   3.4   7.6   -55%
EPS diluted, SEK  0.25  0.89   -72%   0.26     -4%  1.05  2.31   -55%
Adjusted cash
flow 1)            6.9   2.7      -    9.9       -  15.1  14.2      -
Cash flow
from operations    5.7   3.8      -    9.1       -  12.0  17.0      -
All numbers, excl. EPS, Net income and Cash flow from operations
excl. restructuring charges.
1)  Cash flow from operations excl. restructuring cash outlays. Nine
months cash outlays of SEK 3.2 (0.8) b and dividends from Sony
Ericsson of SEK 0.0 (3.6) b

Sales in the quarter decreased 4% year-over-year for comparable units, i.e. excluding Ericsson Mobile Platforms, and decreased 12% adjusted for currency exchange rate effects and hedging. The third quarter last year was comparatively strong with no normal seasonality.

Sequential sales decreased 11%, negatively impacted by currency exchange rate effects, seasonality and a reduced scope of the renewed managed services agreement in Italy. The lower year-over-year sales in Networks and Multimedia were partly offset by stronger sales in Professional Services.

The gross margin, was flat sequentially despite the lower sales, and decreased only slightly year-over-year to 36.2% (37.0%). The year-over-year change is largely attributable to the sales mix, with a higher proportion of network rollout and professional services, efficiency gains and some currency exchange rate effects.

Operating expenses amounted to SEK 11.6 (12.9) b. in the quarter, excluding restructuring charges. The year-over-year reduction is primarily a result of ongoing cost reduction activities, offsetting negative impact from currency exchange rate effects.

Operating income excluding joint ventures and restructuring charges amounted to SEK 5.5 (5.6) b. in the quarter, resulting in a slightly improved operating margin of 11.7% (11.5%). The margin was stable sequentially when adjusted for a capital gain of SEK 0.8 b. in the second quarter 2009.

Ericsson's share in earnings from joint ventures amounted to SEK -1.5 (0.0) b. in the quarter, excluding restructuring charges. This is a significant reduction from the second quarter as a result of the ongoing efficiency improvements. Restructuring charges in joint ventures were insignificant in the quarter.

Financial net was SEK 0.0 (0.5) b. in the quarter, due to lower interest net.

Net income amounted to SEK 0.8 (2.9) b. in the quarter.

Adjusted cash flow amounted to SEK 6.9 (2.7) b. in the quarter, down sequentially from SEK 9.9 b., excluding cash outlays for restructuring of SEK 1.2 b. Year-to-date cash conversion rate was 87% (102%). Trade receivables was positively impacted by currency exchange rate effects and lower sales. While days sales outstanding (DSO) improved slightly sequentially to 118 (121) days, the credit environment is however still tough for second and third tier operators in emerging markets.

Inventory was reduced by SEK 2.2 b. in the quarter to SEK 26.8 b. and turnover was stable at 77 (78) days.

BALANCE SHEET AND OTHER PERFORMANCE INDICATORS
                             Sep 30 June 30 Mar 31 Dec 31
SEK b.                         2009    2009   2009   2008
Net cash                       33.9    27.9   22.9   34.7
Interest-bearing liabilities
and post-employment benefits   45.9    47.6   41.2   40.4
Trade receivables              62.4    69.4   75.2   75.9
   Days sales outstanding       118     121    124    106
Inventory                      26.8    29.0   30.7   27.8
   Of which market             15.9
unit inventory                         17.7   18.9   16.5
   Inventory days                77      78     83     68
Payable days                     57      59     65     55
Customer financing, net         2.7     3.1    2.8    2.8
Return on capital employed       4%      5%     7%    11%
Equity ratio                    52%     51%    52%    50%

The net cash position amounted to SEK 33.9 (27.9) b., up SEK 6.0 b. in the quarter. Cash, cash equivalents and short-term investments amounted to SEK 79.8 (75.5) b.

Customer financing remained low at of SEK 2.7 (3.1) b., reduced by a lower USD rate.

During the quarter, approximately SEK 3.1 b. of provisions were utilized, of which SEK 1.2 b. were related to restructuring. Additions of SEK 2.2 b. were made, of which SEK 0.5 b. related to restructuring. Reversals of SEK 0.1 b. were made.

Ericsson intends to repurchase its callable bond EUR LME 6.75%, maturing on November 28, 2010. The intention is to make a full redemption on November 28, 2009, of all outstanding notes with a total nominal amount of EUR 471 million. The repurchase will reduce gross debt and improve annual interest net.

COST REDUCTIONS

In January, 2009, cost reduction activities were initiated, targeting annual savings of SEK 10 b. from the second half of 2010, split equally between cost of sales and operating expenses. Related restructuring charges were estimated to SEK 6-7 b.

Restructuring charges, excluding joint ventures, in the third quarter were SEK 2.7 b. with a total of SEK 7.0 b. of charges year-to-date. At the end of the quarter, cash outlays of SEK 3.3 b. remain to be made.

The transition to IP technologies with fewer software platforms as well as products with less hardware paves the way for synergies within the product portfolio. The program is ahead of plan and additional opportunities for efficiency improvements have evolved during the program. This will lead to further cost savings and related charges during the last three quarters of the program.

                                                    First      Full
Restructuring charges,    Third        Second      quarter     year
SEK b.                 quarter 2009 quarter 2009    2009       2008
Cost of sales                  -0.8         -1.3        -0.4     -2.5
Research and
development
expenses                       -1.8         -1.7        -0.3     -2.7
Selling and
administrative
expenses                       -0.1         -0.6           -     -1.5
Total                          -2.7         -3.6        -0.7     -6.7
SEGMENT RESULTS
                   Third quarter   Second quarter     Nine months
SEK b.            2009 2008 Change  2009   Change  2009  2008  Change
Networks sales    30.3 33.0  -8%    34.7    -13%   98.6  96.3    2%
Of which network  5.8  4.7   24%     5.9    -2%    16.4  14.0   18%
rollout
EBITDA margin     15%  15%    -      15%     -     15%    15%    -
Operating margin  11%  11%    -      11%     -     11%    10%    -
Professional
Services          12.8 11.8   9%    14.1    -9%    39.7  32.8   21%
sales
Of which managed  3.6  3.5    3%     4.6    -22%   12.3  10.0   24%
services
EBITDA margin     17%  19%    -    17% 1)    -    17% 1)  17%    -
Operating margin  15%  16%    -    16% 1)    -    15% 1)  14%    -
Multimedia sales  3.4  3.5   -4%     3.3     1%    9.9    8.8   13%
2)
EBITDA margin 2)  19%  16%    -      17%     -     15%    9%     -
Operating margin  11%   9%    -      9%      -      7%    1%     -
2)
Sales from
divested and      0.0  0.9    -      0.0     -     0.0    4.0    -
transferred
businesses
Total sales       46.4 49.2  -6%    52.1    -11%  148.1  141.9   4%
All numbers exclude restructuring charges
1)  Second quarter 2009 excludes a capital gain of SEK 0.8 b. from
divestment of TEMS
2)  2008 and 2009 numbers for Multimedia exclude divested Ericsson
Mobile Platforms and PBX operations

NETWORKS

Network sales in the third quarter declined year-over-year by 8%. Even though the comparison is tough with last year's strong third quarter, the market was weaker.