Ericsson Wins SEK 12.5B VodafoneThree Deal to Build UK's 5G Network

Ericsson ERIC has secured a landmark eight-year deal worth SEK 12.5 billion (nearly GBP £1 billion) to power the majority of VodafoneThree’s next-generation mobile network in the U.K., marking one of Europe’s largest network consolidation efforts. Under the agreement, Ericsson becomes the sole nationwide core network vendor for VodafoneThree while supplying a significant portion of the operator’s enhanced radio network.

Ericsson’s technology will play a central role in providing coverage for the U.K.’s four capital cities — London, Edinburgh, Cardiff and Belfast — along with other key hubs, including Leeds, Sheffield, Bristol, Aberdeen, Hull and Bournemouth. The rollout is set to begin soon, with VodafoneThree targeting 99.95% 5G SA population coverage nationwide by 2034.

Ericsson emphasized the importance of robust, programmable networks in unlocking the potential of AI, automation and immersive technologies, highlighting the company’s role as VodafoneThree’s primary vendor.

Ericsson Price and Consensus

Ericsson price-consensus-chart | Ericsson Quote

What Does This Deal Offer?

VodafoneThree will deploy Ericsson’s advanced 5G Standalone (5G SA) hardware, software and solutions across its infrastructure. This will support the operator’s 29 million mobile broadband customers and accelerate the U.K.’s digital transformation through high-performance, programmable connectivity. The network will enable new enterprise and industrial applications powered by AI, automation and immersive technologies such as augmented and virtual reality.

The partnership will see the introduction of Ericsson’s latest 5G RAN products, including compact AI-optimized radios, smart multi-band antennas and energy-efficient basebands designed to deliver faster speeds and seamless connectivity across the country’s diverse terrain. On the core side, Ericsson will deploy its dual-mode 5G Core, IP Multimedia Subsystem (IMS) and Cloud Native Infrastructure Solution, enabling the network to scale with the surging demand for data and evolve toward 5G Advanced capabilities.

Ericsson is well-positioned to cash in on the market momentum with its competitive 5G product portfolio. The company continues to execute its strategy to become a leading mobile infrastructure provider and establish a focused enterprise business. Strategic acquisitions, including Vonage for enterprise expansion, Cradlepoint for 5G growth and Ericom for security, complement its innovation-driven approach.

Ericsson is focusing on 5G system development and has undertaken many notable endeavors to position itself for market leadership on 5G. The company believes that standardization of 5G is the cornerstone for the digitization of industries and broadband. The deployment of 5G networks is likely to boost the adoption of IoT (Internet of Things) devices, with technologies like network slicing gaining more prominence.

Recently, Ericsson advanced the enterprise 5G networking landscape by integrating agentic AI into its NetCloud platform. With the launch of Ericsson’s first enterprise 5G agentic AI virtual expert, enterprises are likely to experience a transformation in how they deploy, optimize and manage private 5G and Wireless WAN solutions.

ERIC’s Zacks Rank & Stock Price Performance

Ericsson, carrying a Zacks Rank #3 (Hold) at present, has gained 6.8% over the past year compared with the Zacks Wireless Equipment industry’s growth of 32.9%.

Stocks to Consider From the Computer and Technology Space

Some better-ranked stocks from the broader technology space are Ubiquiti Inc. UI, InterDigital, Inc. IDCC and Microsoft Corporation MSFT. UI and IDCC sport a Zacks Rank #1 (Strong Buy) while MSFT carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

UI’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 49.5%. In the last reported quarter, Ubiquiti delivered an earnings surprise of 82.47%. Its shares have surged 175.3% in the past year.

IDCC earnings beat the consensus estimate in three of the trailing four quarters while missing in one, with the average surprise being 54.27%. InterDigital’s long-term earnings growth rate is 15%. Its shares have jumped 132.3% in the past year.

Microsoft’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 7.02%. In the last reported quarter, Microsoft delivered an earnings surprise of 8.96%. MSFT’s long-term earnings growth rate is 14.9%. Its shares have inched up 17.6% in the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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