08 September 2022

Swedish tech giant Ericsson will finalise its Russia exit and cut staff this year Kommersant business daily reported.

The company’s headquarters in Stockholm informed its Russian unit that it will shut down and employees will be relieved of their duties by the end of 2022.

Ericsson employs 565 people in the world’s largest country by area and vowed financial and social support to outgoing staff. The firm expects to complete the phaseout in the coming months “as it fulfils its obligations to customers,” a source told Kommersant.

Russian mobile operators, MTS and Tele2, had major contracts with Ericsson prior to Russia’s invasion of Ukraine. This means the country’s telcos now face shortages of equipment for Ericsson’s base stations, which are no longer available under warranty, and the discontinuation of tech support for Ericsson software, the report added.

It is understood that Ericsson could either create a separate legal entity for tech support, or Russian mobile operators could hire its outgoing staff to maintain equipment and services running smoothly.

Ericsson suspended Russian business and put employees on paid leave in April over Russia’s invasion of Ukraine. Its share of the Russian telecom equipment market is estimated at about 20%. Finnish rival Nokia pulled out of the Russian market the same month, while Chinese telecom giant Huawei temporarily suspended new orders and furloughed Russian staff in fear of secondary sanctions.

The three companies account for nearly three-quarters of the global base station market.