Ericsson's CEO is under growing pressure, according to Light Reading sources.

Dan Jones, Mobile Editor

July 1, 2016

2 Min Read
Trouble at Ericsson: Can the CEO Survive July?

July could be a make-or-break month for Ericsson's CEO as consecutive quarters of disappointing results and an ongoing corruption scandal for the Swedish vendor are putting pressure on Hans Vestberg's position at the top, according to sources.

The Stockholm-based vendor is due to report its second-quarter results on July 19. In recent quarters, the company has seen declining revenues, even as -- this year -- the CEO tried to restructure and revamp the 150-year-old company. (See Ericsson Restructures as Sales, Gross Margins Falter in Q1, Ericsson CEO Seeks New Growth Formula and Ericsson Predicts Weak Q4.)

Meanwhile, Ericsson is being probed by US authorities for possible corruption in its Chinese operations, according to Swedish news reports. (See Eurobites: Ericsson at Center of Corruption Probe.)

Light Reading asked Ericsson about the corruption allegations on Thursday. The company sent us this statement on the US inquiry and details about a Greek investigation. Basically, the company isn't saying much beyond this yet.

An Ericsson spokeswoman in New York City also couldn't comment further.

"There's been rumblings for a while now... historically, Ericsson cycles through a CEO every four or five years. They're coming up on four years," says one industry source Light Reading spoke to this week about Vestburg's potential departure.

Ericsson denies that the CEO is under pressure.

Nonetheless, according to two sources within Ericsson, the company's recent strategic alliance with Cisco Systems Inc. (Nasdaq: CSCO) has caused a lot of uncertainty among middle-ranking executives wondering about their jobs. Light Reading has been told that at least two general managers have left recently.

If the second-quarter financials come in below expectations, as they might, that could very well herald a change at the top table at Ericsson.

— Dan Jones, Mobile Editor, Light Reading

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About the Author(s)

Dan Jones

Mobile Editor

Dan is to hats what Will.I.Am is to ridiculous eyewear. Fedora, trilby, tam-o-shanter -- all have graced the Jones pate during his career as the go-to purveyor of mobile essentials.

But hey, Dan is so much more than 4G maps and state-of-the-art headgear. Before joining the Light Reading team in 2002 he was an award-winning cult hit on Broadway (with four 'Toni' awards, two 'Emma' gongs and a 'Brian' to his name) with his one-man show, "Dan Sings the Show Tunes."

His perfectly crafted blogs, falling under the "Jonestown" banner, have been compared to the works of Chekhov. But only by Dan.

He lives in Brooklyn with cats.

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