Ericsson’s Board of Directors has announced that Hans Vestberg has stepped down as president and CEO and member of the Board of Directors of the company with immediate effect. Jan Frykhammar, the executive vice president and CFO, will assume the CEO position until a new CEO is appointed.
Chairman of the Board Leif Johansson said: “Hans Vestberg has led the company for seven years through significant industry and company transformation. Hans has been instrumental in building strong relationships with key customers around the world and his leadership and energy have been an inspiration to employees and leaders across Ericsson. However, in the current environment and as the company accelerates its strategy execution, the Board of Directors has decided that the time is right for a new leader to drive the next phase in Ericsson’s development.”
Vestberg said: “I have had 28 fantastic years at Ericsson, the last seven as CEO. As the industry enters a next phase, driven by 5G, IoT and cloud, it is time for a new CEO to step in and continue the work to ensure Ericsson’s industry leadership.”
In conjunction to presenting its earnings report for the second quarter on July 19, the company presented a strong action plan to significantly reduce cost and adapt to the current market environment.
Hans Vestberg will be available to support the Board and management during his term of notice of six months.
VanillaPlus comment: Hans Vestberg has been regarded as one of the more astute network equipment vendor chief executives as he steered Ericsson from being heavily focused on selling network hardware into a more services-oriented business, engaging with network functions virtualisation, IoT, cloud and generalist IT to broaden the company’s market and compete with Chinese equipment vendors. In contrast to former competitors such as Nortel and Alcatel-Lucent, Ericsson’s transformation looked to be well advanced but the board has clearly decided that the company was not moving quickly enough under Vestberg’s leadership and, after almost seven years, a new face is needed to address the challenge of managing a company with roots in physical hardware in what is now a software-oriented world.
