Ericsson to book $1.1 billion impairment on weaker outlook for Vonage

(Reuters) – Mobile telecoms equipment maker Ericsson (BS:) said on Wednesday it will record a noncash impairment charge of 11.4 billion Swedish crowns ($1.09 billion) in the second quarter of 2024, related to its acquisition of Vonage.

The impairment charge reflects lower anticipated market growth in some of Vonage’s current portfolio, the company said in a statement.

“Given deterioration in the market environment and elective decisions we have made to refocus our investments in strategically prioritized areas, we have reassessed certain growth assumptions,” Vonage Chief Executive Officer Niklas Heuveldop said.

The Swedish telecom gear maker bought cloud communication firm Vonage in 2022 for $6.2 billion.

($1 = 10.4934 Swedish crowns)