Solid results of ENT in Q1 2025

• Sales revenue amounted to EUR 54.2 million, up by 4.2% year-over-year.
• We are focused on quality deliveries to our customers and maintaining competitiveness in the market thanks to our technology leadership

In her statement about the company’s business results in Q1 2025, Gordana Kovačević, President of Ericsson Nikola Tesla’s Management Board, highlighted: “In Q1 2025, the total sales revenue amounted to EUR 54.2 million, up by 4.2% year-over-year, with growth recorded in all market segments. The quarter was marked by the signing of new contracts with our long-term partners in Croatia and export markets. In the domestic market, we have continued with the implementation of advanced technology solutions in the telecom networks of the leading operators. In the Digital Society segment, we have continued quality cooperation on contract execution with many ministries and public administration bodies in the Republic of Croatia. We would like to highlight the continuation of cooperation with the Ministry of the Interior of the Republic of Croatia regarding border control by signing a contract related to the service and maintenance of stationary systems. We have also expected to sign the contracts for significant projects co-financed by the EU funds, for which it was decided that Ericsson Nikola Tesla will be the supplier; however, they have not yet been signed, which presents a challenge in terms of implementation.“

In export markets, with the operator HT Mostar we have contracted the software management services for the entire installed base of Ericsson solutions for the period until 2027, a new expansion of the radio access network, and the implementation of access control and quality of service for the introduction of VoLTE functionality. With BH Telecom, a three-year contract was signed regarding microwave systems (Mini Link).

In Kosovo, with the operator IPKO, we have contracted the maintenance of IPKO’s mobile network until the end of 2026. With the operator Telekom Kosova, we have continued successful cooperation on the mobile network modernization.

Furthermore, in cooperation with the operator Crnogorski Telekom testing of advanced 5G+ technology in 26 GHz band (known as mmWave) was successfully performed.

When it comes to research and development (R&D) and the delivery of services to Ericsson, we have been continuously achieving quality results. Our R&D Center continues to grow in the development of the state-of-the-art solutions for Radio Access Networks (RAN), utilizing the opportunity to additionally position itself in this field during 2025.
The strategic focus of R&D is to build organizational E2E software development capability and to position Ericsson Nikola Tesla as the supplier that is highly performing and E2E capable to deliver such solutions in the most complex areas of mobile technology (Network segment). Moreover, Ericsson Nikola Tesla’s R&D Center is continuously among the best rated R&D Centers, and during the regular evaluations that Ericsson corporation conducts four times a year, R&D Center achieved a high score of 91.6%.

In terms of financial indicators, gross profit amounted to EUR 8.3 million, down by 5% year-over-year, as a result of business mix, higher cost related to materials and employees, and activities focused on business optimization. Gross margin was 15.3% (Q1 2024: 16.8%). Operating profit amounted to EUR 6.8 million, down by 7.8% year-over-year as a result of lower gross profit and increased selling and administrative expenses. Operating margin amounted to 12.6% (Q1 2024: 14.2%). We concluded the end of Q1 with a solid balance sheet and an equity ratio of 41.7%. Cash and cash equivalents, including the short-term financial assets, amounted to EUR 65.0 million, which accounts for 36.7% of the total assets. A positive cash flow from operating activities was achieved in the amount of EUR 4.4 million (Q1 2024: EUR 1.1 million).

We have continued excellent cooperation with the academic community and to the students of Faculty of Electrical Engineering and Computing (FER) we presented activities of the Radio Department of our R&D Center, and additionally, in our 5G laboratory we demonstrated concrete examples of how 5G network works. As part of the Workshop on Embedded Systems (WES), organized for the ninth year in a row by FER and the student association EESTEC LC Zagreb, our experts held a lecture about software development for mobile networks worldwide, and a similar lecture was held at the Zagreb University of Applied Sciences (TVZ). With this approach, the company highlights its openness towards knowledge sharing and direct attraction of talents, while the students receive firsthand information about what it is like to work in our company and the ICT sector.

„The uncertain geopolitical and macroeconomic environment that we have been witnessing requires that we are additionally careful and responsible. Therefore, we have been continuously monitoring changes in the markets where we operate, while remaining focused on the areas we can act on: quality deliveries to our customers and maintaining competitiveness in the market thanks to our technology leadership. Furthermore, we are also working on the application of artificial intelligence in creating new solutions for customers, as well as increasing the efficiency of our business processes.

Our  wanted position remains unchanged: in the Telecom segment to keep the leading position in the markets where we operate, in the Digital Society segment to be the partner of choice in the selected strategic areas, in research and development to remain one of the best positioned R&D Centers in Ericsson’s global R&D organization, and in the ICT services segment to strengthen the position of extremely competent and competitive center that provides quality technical, innovative and consulting services. Therefore, we invest in the development of new products and services, business growth in new markets and with new customers, retention of employees while developing their competencies, and we are focused on profitability and cost efficiency.“, concluded Gordana Kovačević, President of ENT Management Board.

Communications Ericsson Nikola Tesla