ERICSSON LM TELEPHONE CO (ERIC) Business

A. History and Development of the Company

General facts on the company

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Organization number: 556016-0680

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Telephone number: +46 10 719 0000

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (“ADS”), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent Company operations: The business of the Parent Company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions internal banking activities and customer credit management.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Shares owned directly by the Parent Company” in Item 4.C. below. We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3.D. Risk Factors.”

Company history and development

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and other electrical and mechanical equipment. Shortly thereafter, the Company began manufacturing its first telephones.

Ericsson is a leading provider of mobile connectivity solutions to communications service providers, enterprises and the public sector. The Company’s portfolio spans the following segments: Networks, Cloud Software and Services and Enterprise (which includes Global Communications Platform, Wireless Wide Area Networks and private 5G networks). In addition, segment Other consists of media businesses and other non-allocated businesses. Ericsson delivers high-performing, programmable and energy-efficient networks that enable greater service differentiation. Ericsson’s enterprise solutions provide superior connectivity to businesses and advanced network capabilities to application developers.

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The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Strategy

• Leading mobile networks to drive an AI-powered world

• Leadership in mobile networks

• Scaling the mobile platform

• Strategic foundation

• 150 years of connectivity

• Board of Directors’ Report

• Financial highlights – Capital expenditure

For capital expenditures, we typically use available cash from operations.

• Notes to the consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

B. Business Overview

The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Strategy

• Leading mobile networks to drive an AI-powered world

• Leadership in mobile networks

• Scaling the mobile platform

• Strategic foundation

• 150 years of connectivity

• Board of Directors’ Report

• Financial highlights – Research and Development (R&D) expenses

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market areas

Ericsson’s value chain spans the extraction and processing of raw materials used in electronic components to the delivery of communication services for end users. It comprises five main stages: global electronics manufacturing, direct suppliers, own operations, direct customers, and consumers and end users.

As is typical for large multinational companies, Ericsson’s value chain is complex and interconnected, which creates challenges for visibility and traceability beyond the first tier of suppliers and customers. In 2025, the Company had approximately 15,000 active direct suppliers, of which approximately 200 provided materials and components used in Ericsson’s hardware.

The global electronics manufacturing value chain begins with the extraction of natural resources used in electronic hardware. These materials are refined, traded and manufactured into parts and components that are assembled into finished products. Ericsson’s regional supply hubs consolidate material from component suppliers and distribute it to production sites. Ericsson’s supply and component hubs are located in Sweden, Belgium, Germany, The Netherlands, the United States, Mexico, the United Arab Emirates, India, Malaysia, Singapore and China.

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial condition

• Risks related to legal and regulatory matters

• Risks related to cybersecurity matters

• Risks related to environmental, social and business conduct matters

• Corporate Governance Report

• Regulation

Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 (“ITRA”)

In 2018, Ericsson initiated its wind down in Iran, and, in 2025, had no business engagements in Iran. Ericsson is continuing its efforts to liquidate its local legal entity, in accordance with applicable sanctions and local law requirements. Ericsson does not normally allocate gross revenue or net income on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, in 2025, Ericsson has estimated that its gross revenue and net profits attributable to Iran were negligible.

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Before 2018, Ericsson had arranged performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson had entered into relating to the business in Iran. In such instances, Ericsson usually engaged its banks outside Iran, who in turn engaged local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, the performance bonds have been frozen by the EU banks. One local performance bond for the local legal entity has been renewed with Saman Bank. Existing bank guarantees issued to Ericsson by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations related to earlier business engagements were renewed.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our Parent Company as of December 31, 2025. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Shares owned directly by the Parent Company

Company Reg. No. Domicile Percentageof ownership Par value in localcurrency,million Carrying value,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Red Bee Media Holding AB 559113-9729 Sweden 100 — 773 Ericsson Insurance (Försäkring) AB 516406-0534 Sweden 100 50 469 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 74 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 Ericsson Mobile Financial Services AB 559335-5059 Sweden 100 — 15 Ericsson Software Technology Holding AB 559094-8963 Sweden 100 — 7 Aktiebolaget Aulis 556030-9899 Sweden 100 14 6 Other (Sweden) — — 374 Ericsson S.A/N.V. Belgium 100 5 119 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Germany GmbH Germany 100 1 1,816 Ericsson Hungary Ltd. Hungary 100 1,301 120 Ericsson Telecomunicazioni S.p.A. Italy 100 44 2,429 Ericsson Holding International B.V. Netherlands 100 222 2,983 Ericsson A/S Norway 100 75 257 Ericsson Sp. z o.o. Poland 100 4 412 Ericsson Telecomunicacoes LDA. Portugal 100 1 23 Ericsson Antenna Technology Romania S.R.L. Romania 100 98 206 Ericsson Telecommunications Romania S.R.L. Romania 100 49 103 Ericsson España S.A.U Spain 100 28 14 Ericsson Ltd. United Kingdom 100 53 1,663 Other (Europe, excluding Sweden) — — 255 Ericsson Canada Inc. Canada 100 — 221 Ericsson Holding II Inc. United States 100 — 34,295 Ericsson Smart Factory Inc. United States 100 — 424 Ericsson Global Network Platform Holding Inc. United States 100 — 18,701 Ericsson de Colombia S.A.S Colombia 100 701 178 Ericsson Antenna Technology Mexico S.A. de C.V. Mexico 100 589 239 Ericsson Telecom S.A. de C.V. Mexico 100 1,439 576 Other (Americas) — — 232 Teleric Pty Ltd. Australia 100 20 100 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 9,531 614 Ericsson India Private Limited India 100 291 51 Ericsson Korea Partners Co., Ltd. Korea, Republic of 75 285 2,087 Ericsson (Malaysia) Sdn. Bhd. Malaysia 100 3 131 Ericsson South Africa (Pty.) Ltd South Africa 70 — 94 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 (1) 90 17 Ericsson Telekomünikasyon A.Ş. Turkey 100 5 150 Other (the rest of the world) — — 463 Total 95,154 Associated companies Leone Media Inc. United States 46 134 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 330

1) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Shares owned by subsidiary companies

Company Reg. No. Domicile Percentage of ownership Subsidiary companies Ericsson Facilities GmbH Germany 100 Ericsson GmbH Germany 100 Ericsson Telecommunicatie B.V. Netherlands 100 Red Bee Media Limited United Kingdom 100 Ericsson Inc. United States 100 Vonage Holdings Corp. United States 100 Ericsson Enterprise Wireless Solutions Inc. United States 100 Ericsson Telecomunicações LTDA. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 100 Ericsson Japan K.K. Japan 100

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D. Property, Plants and Equipment

Primary manufacturing and assembly facilities

We continuously adjust our production capacity to meet expected customer demand. We consider the production capacity of our manufacturing network to be sufficient to meet the requirements of our business. The extent of utilization of our manufacturing facilities varies from plant to plant and from time to time during the year. None of these facilities is subject to a material encumbrance.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2025 2024 2023 Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sweden 1 3.7 1 5 1 5 China 1 10.4 1 10.4 1 13.9 Estonia 1 9 1 9 1 9 Brazil 1 8.3 1 8.3 1 7 United States 1 10.3 1 10.1 1 9 Romania 1 9 1 9 1 10 Mexico 1 7.5 1 7.5 1 7.5 Total 7 58.20 7 59.0 7 61.0

* Floor space in square meters does not include any warehouses or transportation areas.

The information set forth under the following headings of the 2025 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• Board of Directors’ Report

• Financial highlights – Capital expenditure

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Risks related to legal and regulatory matters

• Risks related to environmental, social and business conduct matters

A. History and Development of the Company

General facts on the company

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Organization number: 556016-0680

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Telephone number: +46 10 719 0000

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (“ADS”), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent Company operations: The business of the Parent Company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our Parent Company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

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Subsidiaries and associated companies: For a list of our significant subsidiaries, please see Item 4.C. “Shares owned directly by the Parent Company.” We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3.D. Risk Factors.”

Company history and development

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson is a leading provider of mobile connectivity solutions to communications service providers, enterprises and the public sector. The Company’s portfolio spans the following segments: Networks, Cloud Software and Services and Enterprise (which includes Global Communications Platform, Wireless Wide-Area Networks and private cellular networks). In addition, segment Other includes media businesses as well as other non-allocated business. Ericsson delivers high-performing, programmable and energy-efficient networks that enable greater service differentiation. Ericsson’s enterprise solutions provide superior connectivity to businesses and advanced network capabilities to application developers.

The information set forth under the following headings of the 2024 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Strategy – Creating value through mobile network innovation

• Board of Directors’ Report

• Business in 2024

• Financial highlights — Capital expenditures

For capital expenditures, we typically use available cash from operations.

• Notes to the consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

B. Business Overview

The information set forth under the following headings of the 2024 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Strategy – Creating value through mobile network innovation

• Board of Directors’ Report

• Business in 2024

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market areas

• Sourcing and supply

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial condition

• Risks related to legal and regulatory matters

• Risks related to cybersecurity matters

• Risks related to environmental, social and business conduct matters

• Corporate Governance Report

• Regulation

Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 (“ITRA”)

During 2024, Ericsson’s recorded net sales related to business in Iran was SEK -1 million, from internal clearing of old and minor items as part of wind down activities. Ericsson does not normally allocate net income on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating loss (income/loss before taxes and financial net) from Iran operations was, after internal cost allocation and impairments, SEK -35 million during 2024.

In some instances, Ericsson has previously had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson had entered into relating to the business in Iran. In such instances, Ericsson usually engaged its banks outside Iran, who in turn engaged local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these banks with respect to Ericsson’s business activities in Iran were issued during 2024. During 2024, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed.

In 2018, Ericsson began reducing its business engagement as well as its presence in Iran significantly but continued to provide certain critical services and support to telecommunications networks and systems. As of December 2024, Ericsson has wound down its active business activities in Iran and anticipates that future activities will be limited to settlement of unfulfilled obligations, as well as administrative activities to close down the legal entity.

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C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our Parent Company as of December 31, 2024. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Shares owned directly by the Parent Company

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 74 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 Aktiebolaget Aulis 556030-9899 Sweden 100 14 6 Other (Sweden) — — 736 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Antenna Technology Germany GmbH Germany 100 2 21 Ericsson Germany GmbH Germany 100 1 1,816 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 2,429 Ericsson Holding International B.V. The Netherlands 100 222 2,983 Ericsson A/S Norway 100 75 257 Ericsson Sp. z o.o. Poland 100 4 412 Ericsson España S.A.U Spain 100 28 14 Ericsson Ltd. United Kingdom 100 53 1,663 Other (Europe, excluding Sweden) — — 555 Ericsson Canada Inc. Canada 100 — 221 Ericsson Holding II Inc. United States 100 — 34,295 Ericsson Smart Factory Inc. United States 100 — 424 Ericsson Global Network Platform Holding Inc. United States 100 — 18,031 Companía Ericsson S.A.C.I. Argentina 95 (1) 7,677 10 Ericsson de Colombia S.A.S Colombia 100 701 178 Ericsson Telecom S.A. de C.V. Mexico 100 1,439 576 Other (United States, Latin America) — — 384 Teleric Pty Ltd. Australia 100 20 100 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 9,531 614 Ericsson India Private Limited India 100 291 51 Ericsson-LG Co Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 100 3 131 L. M. Ericsson (Nigeria) Limited Nigeria 100 50 10 Ericsson South Africa PTY. Ltd South Africa 70 — 94 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 (2) 90 17 Ericsson Telekomünikasyon A.Ş. Turkey 100 5 150 Other countries (the rest of the world) — — 327 Total 93,569 Joint ventures and associated companies Concealfab Co United States 36 — 298 Leone Media Inc. United States 46 134 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 628

1) Through subsidiary holdings, total holdings amount to 100% of Compañía Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Shares owned by subsidiary companies

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Ericsson Telekommunikation GmbH Germany 100 Ericsson GmbH Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Inc. United States 100 Vonage Holdings Corp. United States 100 Ericsson Enterprise Solutions Inc. United States 100 Iconectiv, LLC United States 83 Ericsson Telecomunicações LTDA Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100

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D. Property, Plants and Equipment

Primary manufacturing and assembly facilities

We continuously adjust our production capacity to meet expected customer demand. During 2024, our overall capacity utilization* was 42%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2024 2023 2022 Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sweden 1 5 1 5 1 5 China 1 10.4 1 13.9 1 13.9 Estonia 1 9 1 9 1 9 Brazil 1 8.3 1 7 1 6.5 United States 1 10.1 1 9 1 6 Total 5 42.8 5 43.9 5 40.4

* Test capacity utilization.

** Floor space in square meters does not include any warehouses or transportation areas.

In July 2023, the Company announced plans to build a next-generation smart manufacturing and technology hub in Tallinn, Estonia. Ericsson is redirecting its investment in Europe and will no longer proceed with building the previously announced new facility in Tallinn, Estonia. Instead, Ericsson will focus on modernizing its existing sites.

The information set forth under the following headings of the 2024 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• Board of Directors’ Report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Risks related to legal and regulatory matters

• Risks related to environmental, social and business conduct matters

A. History and Development of the Company

General facts on the company

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Organization number: 556016-0680

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Telephone number: +46 10 719 0000

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (“ADS”), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent Company operations: The business of the Parent Company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our Parent Company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see Item 4.C. “Shares owned directly by the Parent Company.” We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3.D. Risk Factors.”

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Company history and development

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers and enterprises to capture the full value of connectivity. The Company’s portfolio spans the following segments: Networks, Cloud Software and Services and Enterprise (which includes Enterprise Wireless Solutions, Global Communications Platform, and Technologies and New Businesses). In addition, segment Other includes media businesses as well as other non-allocated business. Our portfolio is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s innovation investments have delivered the benefits of mobility and mobile broadband to billions of people globally.

The information set forth under the following headings of the 2023 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• This is Ericsson

• Business strategy – Creating long-term value

• Board of Directors’ report

• Business in 2023

• Financial highlights - Capital expenditures

For capital expenditures we typically use available cash from operations.

• Notes to the consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

B. Business Overview

The information set forth under the following headings of the 2023 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• This is Ericsson

• Business strategy – Creating long-term value

• Board of Directors’ report

• Business in 2023

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market areas

• Sourcing and supply

• Sustainability and Corporate Responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial condition

• Legal and regulatory risks

• Cybersecurity risks

• Environmental, social and business conduct risks

• Corporate Governance report

• Regulation

During 2023, Ericsson recorded revenues relating to the sale of communications infrastructure related support services in Iran to the following telecommunications company operating in the country: MTN Irancell. During 2023, Ericsson’s gross revenue (reported as net sales) related to sales to MTN Irancell was SEK 91 million. Ericsson does not normally allocate net profit (reported as net income)on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating loss (income/loss before taxes and financial net) from such sales was, after internal cost allocation, SEK -98 million during 2023.

In some instances, Ericsson has previously had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson had entered into relating to the business in Iran. In such instances, Ericsson usually engaged its banks outside Iran, who in turn engaged local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these banks with respect to Ericsson’s business activities in Iran were issued during 2023. During 2023, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed. Further, Ericsson has made two payments (535,153,658 IRR on January 24, 2023 and 1,498,643,323 IRR on February 14, 2023) to the Islamic Republic of Iran Customs Administration for customs fees related to repaired products, which the Central Bank of Iran processed.

In 2018, Ericsson began reducing its business engagement as well as its presence in Iran significantly but continued to provide certain critical services and support to telecommunications networks and systems. As of December 2023, Ericsson has wound down its active business activities in Iran and anticipates that future activities will be limited to fulfilling its obligations, such as deliveries of repairs and software licenses already purchased by the customer as well as administrative activities to close down the legal entity.

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C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our Parent Company as of December 31, 2023. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Shares owned directly by the Parent Company

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 74 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 Aktiebolaget Aulis 556030-9899 Sweden 100 14 6 Other (Sweden) — — 706 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Antenna Technology Germany GmbH Germany 100 2 21 Ericsson Germany GmbH Germany 100 1 1,816 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 2,429 Ericsson Holding International B.V. The Netherlands 100 222 2,983 Ericsson A/S Norway 100 75 114 Ericsson Sp. z o.o. Poland 100 4 412 Ericsson España S.A.U Spain 100 28 14 Ericsson Ltd. United Kingdom 100 53 1,957 Other (Europe, excluding Sweden) — — 709 Ericsson Holding II Inc. United States 100 — 34,295 Ericsson Smart Factory Inc. United States 100 — 424 Ericsson Global Network Platform Holding Inc. United States 100 — 30,674 Companía Ericsson S.A.C.I. Argentina 95 (1) 193 10 Ericsson Canada Inc. Canada 100 — 221 Ericsson de Colombia S.A.S Colombia 97 (1) 701 176 Ericsson Telecom S.A. de C.V. Mexico 100 1,439 576 Other (United States, Latin America) — — 435 Teleric Pty Ltd. Australia 100 20 100 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 9,531 614 Ericsson India Private Limited India 100 291 51 Ericsson Kenya Limited Kenya 100 — 10 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 100 3 131 Ericsson South Africa PTY. Ltd South Africa 70 — 94 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 (2) 90 17 Ericsson Telekomünikasyon A.Ş. Turkey 100 5 150 Other countries (the rest of the world) — — 325 Total 106,534 Joint ventures and associated companies Concealfab Co United States 36 — 298 Leone Media Inc. United States 46 134 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 628

1) Through subsidiary holdings, total holdings amount to 100% of Compañía Ericsson S.A.C.I. and Ericsson de Colombia S.A.S.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

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Shares owned by subsidiary companies

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Emodo Inc. United States 100 Ericsson Telekommunikation GmbH Germany 100 Ericsson GmbH Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Inc. United States 100 Vonage Holdings Corp. United States 100 Ericsson Wireless Office Inc. United States 100 Cradlepoint Inc. United States 100 Iconectiv, LLC. United States 83 Ericsson Telecomunicações LTDA. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100

D. Property, Plants and Equipment

Primary manufacturing and assembly facilities

We continuously adjust our production capacity to meet expected customer demand. During 2023, our overall capacity utilization* was 42%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2023 2022 2021 Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sweden 1 5 1 5 1 5 China 1 13.9 1 13.9 1 13.9 Estonia 1 9 1 9 1 9 Brazil 1 7 1 6.5 1 6.5 United States 1 9 1 6 1 6 Total 5 43.9 5 40.4 5 40.4

* Test capacity utilization.

** Floor space in square meters does not include any warehouses or transportation areas.

In July 2023, the Company announced plans to build a next-generation smart manufacturing and technology hub in Tallinn, Estonia.

The proposed 50,000-square-meter facility is a green field investment valued at approximately EUR 155 million and expected to be operational in early 2026. This project will be executed through the Company’s Estonian affiliate and will be financed through the Company’s Treasury organization. The Company currently does not expect any increase of production capacity after the completion of this project.

The Company plans to consolidate all of its operations in Estonia into this proposed new facility, which will be a single, state-of-the art, smart hub that comprises test labs, warehouses, production lines, and offices. This smart hub will be used for co-developing cellular ecosystems and production techniques, mainly with customers and partners in Europe but with global impact on industrialization for volume production.

As a first step towards this goal, the Company, through its Estonian affiliate, has signed a definitive agreement dated June 29, 2023, to acquire property to build this proposed facility, with the transaction expected to close in the fourth quarter of 2024, subject to agreed conditions. The Company has already paid EUR 5.5 million in connection with acquiring the property up to date.

The information set forth under the following headings of the 2023 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Legal and regulatory risks

• Environmental, social and business conduct risks

A. History and Development of the Company

General facts on the company

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Organization number: 556016-0680

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Telephone number: +46 10 719 0000

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the U.S. Securities and Exchange Commission (the “SEC”) maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent Company operations: The business of the Parent Company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our Parent Company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see Item 4.C. “Shares owned directly by the Parent Company.” We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3.D. Risk Factors.”

Company history and development

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers and enterprises to capture the full value of connectivity. The Company’s portfolio spans the following segments: Networks, Cloud Software and Services and Enterprise (which includes Enterprise Wireless Solutions, Global Communications Platform, and Technologies and New Businesses). In addition, segment Other includes media businesses as well as other non-allocated business. Our portfolio is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s innovation investments have delivered the benefits of mobility and mobile broadband to billions of people globally.

The information set forth under the following headings of the 2022 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• This is Ericsson

• Business strategy – Creating long-term value

• Board of Directors’ report

• Business in 2022

• Financial highlights—Capital expenditures

For capital expenditures we typically use available cash from operations.

• Notes to the consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

Table of Contents

B. Business Overview

The information set forth under the following headings of the 2022 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• This is Ericsson

• Business strategy – Creating long-term value

• Board of Directors’ report

• Business in 2022

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market areas

• Sourcing and supply

• Sustainability and Corporate Responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial situation+

• Legal and regulatory risk

• Internal control risk

• Environmental, social and business conduct risk

• Corporate Governance report

• Regulation and compliance

During 2022, Ericsson recorded revenues relating to the sale of communications infrastructure related products and services in Iran to the following telecommunications company operating in the country: MTN Irancell. There are some transactions related to Mobile Communication Company of Iran (MCCI), primarily from internal clearing/accounting of pending old and minor items called as GR/IR (good receipt) clean up. During 2022, Ericsson’s gross revenue (reported as net sales) related to sales to MTN Irancell was SEK 106 million. Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales was, after internal cost allocation, SEK 29 million during 2022.

In some instances, Ericsson has previously had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson had entered into relating to the business in Iran. In such instances, Ericsson usually engaged its banks outside Iran, who in turn engaged local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these banks with respect to Ericsson’s business activities in Iran were issued during 2022. During 2022, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran.

Since 2018, Ericsson has reduced its business engagement as well as its presence in Iran significantly but has continued to provide certain critical services and support to telecommunications networks and systems. However, as the complexity associated with operating in the country continues to increase, Ericsson is planning for an orderly wind down as soon as practicable.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our Parent Company as of December 31, 2022. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Table of Contents

Shares owned directly by the Parent Company

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Ericsson Software Technology Holding AB 559094-8963 Sweden 100 — 7 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 74 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 Aktiebolaget Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,257 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Antenna Technology Germany GmbH Germany 100 2 21 Ericsson Germany GmbH Germany 100 1 2,844 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 2,429 Ericsson Holding International B.V. The Netherlands 100 222 2,983 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 160 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 28 14 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 10 Ericsson Ltd. United Kingdom 100 53 1,957 Other (Europe, excluding Sweden) — — 974 Ericsson Holding II Inc. United States 100 — 34,295 Ericsson Smart Factory Inc. United States 100 — 424 Ericsson Global Network Platform Holding Inc. United States 100 — 51,298 Companía Ericsson S.A.C.I. Argentina 95 1) 193 99 Ericsson Canada Inc. Canada 100 — 221 Ericsson Del Paraguay S.A. Paraguay 95 1) 42,647 53 Ericsson Telecom S.A. de C.V. Mexico 100 1,439 576 Other (United States, Latin America) — — 389 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 9,531 614 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Kenya Limited Kenya 100 — 46 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 100 3 131 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 336 Total 128,638 Joint ventures and associated companies Concealfab Co United States 36 — 298 Leone Media Inc. United States 46 134 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 628

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I. and Ericsson Del Paraguay S.A.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Table of Contents

Shares owned by subsidiary companies

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Emodo Inc. United States 100 Ericsson Telekommunikation GmbH Germany 100 Ericsson GmbH Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Inc. United States 100 Vonage Holdings Corp. United States 100 Ericsson Wireless Office Inc. United States 100 Cradlepoint Inc. United States 100 Iconectiv, LLC. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100

D. Property, Plants and Equipment

Primary manufacturing and assembly facilities

We continuously adjust our production capacity to meet expected customer demand. During 2022, our overall capacity utilization* was 53%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2022 2021 2020 Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sites Thousandsof sq meters** Sweden 1 5 1 5 1 5 China 1 13.9 1 13.9 1 13.9 Estonia 1 9 1 9 1 9 Brazil 1 6.5 1 6.5 1 6.5 United States 1 6 1 6 1 6 Total 5 40.4 5 40.4 5 40.4

* Test capacity utilization.

** Floor space in square meters does not include any warehouses or transportation areas.

The information set forth under the following headings of the 2022 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial report

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Legal and regulatory risk

• Environmental, social and business conduct risk

A. History and Development of the Company

General facts on the company

Legal and commercial name of the Parent Company:

Telefonaktiebolaget LM Ericsson (publ).

Organization number:

556016-0680

Legal form of the Parent Company:

A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation:

Sweden.

Date of incorporation:

The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile:

Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Telephone number:

+46 10 719 0000

Website:

www.ericsson.com

. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC:

http://www.sec.gov

.

Agent in the US:

Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares:

Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations:

The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies:

For a list of our significant subsidiaries, please see “Item 4C. Shares owned directly by the Parent Company”. We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financial Report – Risk Factors”.

Company history and development

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers to capture the full value of connectivity. The company’s portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world.

The information set forth under the following headings of the 2021 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Business strategy – Creating long-term value

• Business model – Customer focus and technology leadership

• Board of Directors’ Report

• Business in 2021

• Financial Highlights - Capital expenditures

For capital expenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

B. Business Overview

The information set forth under the following headings of the 2021 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Business strategy – Creating long-term value

• Business model – Customer focus and technology leadership

• Board of Directors’ report

• Business in 2021

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

Table of Contents

• Business results – Market Areas

• Sourcing and supply

• Sustainability and Corporate Responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial situation

• Legal and regulatory risk

• Internal control risk

• Environmental, social and governance risk

• Corporate Governance Report

• Regulation and compliance

Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 (ITRA)

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Inspectorate of Strategic Products and in compliance with applicable economic sanctions and export controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, customs related services, salaries, rents, utilities, local accommodation, transportation, office and similar supplies. As a result, Ericsson has contact with companies and public functions that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is challenging to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

Ericsson always strives to honor its engagements with existing customers in compliance with applicable export controls, sanctions and other laws, rules and regulations, carefully evaluates the implications of any sanctions and continues to monitor developments in this area as it relates to the ability to continue delivering products and services to customers. As a result of the US withdrawal from the Joint Comprehensive Plan of Action (the JCPOA) in 2018, Ericsson has reduced its business and organization in Iran significantly but still continues to provide critical services and support to its customers in order for their networks to function. As Ericsson provides such services and support, it may need to interact with other counterparties. Ericsson continues to explore, including with EU and US authorities, whether and how the last years’ disruptive impact on the overall ability to support its customers can be reduced and, by doing so endeavor to avoid undue impacts on the access of the people of Iran to humanitarian items/basic services such as telecommunications.

During 2021, Ericsson recorded revenues relating to the sale of communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: Mobile Communication Company of Iran (MCCI), and MTN Irancell. The revenues relating to MCCI relate to sales conducted before 2021. During 2021, Ericsson’s gross revenue (reported as net sales) related to sales to MCCI and MTN Irancell was approximately SEK 111 million. In addition, Ericsson supplied network critical software capacities to MTN Irancell for a current value of approximately SEK 304 million during the year, which was not recorded as revenue as per the applied accounting policies, and thus Ericsson has not yet recorded any net revenues or net profits for these activities. Ericsson does not normally allocate net profit (reported as net income) on a

country-by-country

or

activity-by-activity

basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales was, after internal cost allocation approximately SEK 20 million during 2021.

Ericsson uses the local banks Saman Bank and Pasargad Bank for local transactions in local currency, cash management and deposits. In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank, Saman Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these five banks with respect to Ericsson’s business activities in Iran were issued during 2021. During 2021, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2021. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting,

SE-164

83 Stockholm, Sweden.

Table of Contents

Shares owned directly by the Parent Company

Company Reg. No. Domicile Percentage of ownership Par value in local currency, million Carryingvalue, SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Ericsson Software Technology Holding AB 559094-8963 Sweden 100 — 7 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,142 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Antenna Technology Germany GmbH Germany 100 2 21 Ericsson Germany GmbH Germany 100 1 2,844 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 3,173 Ericsson Holding International B.V. The Netherlands 100 222 2,983 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 160 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 28 14 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 10 Other (Europe, excluding Sweden) — — 972 Ericsson Holding II Inc. United States 100 — 30,281 Ericsson Smart Factory Inc. United States 100 — 191 Companía Ericsson S.A.C.I. Argentina 951) 193 99 Ericsson Canada Inc. Canada 100 — 51 Belair Networks Canada 100 108 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 576 Other (United States, Latin America) — — 486 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 9,531 614 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Kenya Limited Kenya 100 — 69 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 100 3 131 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 492) 90 17 Other countries (the rest of the world) — — 501 Total 72,009 Joint ventures and associated companies Concealfab Co USA 28 — 64 Leone Media Inc. USA 49 134 790 Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 1,184

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Table of Contents

Shares owned by subsidiary companies

Company Reg. No. Domicile Percentage of ownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Emodo Inc. United States 100 Ericsson Telekommunikation GmbH Germany 100 Ericsson GmbH Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wireless Office Inc. United States 100 Cradlepoint Inc. United States 100 Iconectiv, LLC. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

D. Property, Plant and Equipment

Primary manufacturing and assembly facilities

We continuously adjust our production capacity to meet expected customer demand. During 2021, our overall capacity utilization** was 63%.

The table below summarizes where we have major sites and the total floor space at

year-end.

All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2021 2020 2019 Sites Thousands of sq meters* Sites Thousands of sq meters* Sites Thousands of sq meters* Sweden 1 5 1 5 1 5 China 1 13.9 1 13.9 1 13.9 Estonia 1 9 1 9 1 9 Brazil 1 6.5 1 6.5 1 6.7 USA 1 6 1 6 0 0 Total 5 40.4 5 40.4 4 34.6

* Floor space in square meters does not include any warehouses or transportation areas.

** Test capacity utilization.

The information set forth under the following headings of the 2021 Swedish Annual Report (adjusted version) is incorporated herein by reference:

• Financial Report

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Legal and regulatory risk

• Environmental, social and governance risk

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Item 4C. Shares owned directly by the Parent Company ”. We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financial Report–Risk Factors”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers to capture the full value of connectivity. The company’s portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world.

The information set forth under the following headings of the 2020 Swedish Annual Report is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Business strategy

• Business model

• Board of Directors’ Report

• Business in 2020

• Financial Highlights – Capital expenditures

For capital expenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

The information set forth under the following headings of the 2020 Swedish Annual Report is incorporated herein by reference:

• Financial Report

• This is Ericsson

• Business strategy

• Business model

• Board of Directors’ report

• Business in 2020

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

Table of Contents

• Business results – Market Areas

• Sourcing and supply

• Sustainability and Corporate Responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial situation

• Legal and regulatory risk

• Internal control risk

• Environmental, social and governance risk

• Corporate Governance Report

• Regulation and compliance

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Inspectorate of Strategic Products and in compliance with applicable economic sanctions and export controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, customs related services, salaries, rents, utilities, local accommodation, transportation, office and similar supplies. As a result, Ericsson has contact with companies and public functions that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is challenging to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

Ericsson always strives to honor its engagements with existing customers in compliance with applicable export controls, sanctions and other laws, rules and regulations, carefully evaluates the implications of any sanctions and continues to monitor developments in this area as it relates to the ability to continue delivering products and services to customers. As a result of the US withdrawal from the Joint Comprehensive Plan of Action (the JCPOA) in 2018, Ericsson has reduced its business and organization in Iran significantly but still continues to provide critical services and support to its customers in order for their networks to function. As Ericsson provides such services and support, it may need to interact with other counterparties. Ericsson continues to explore, including with EU and US authorities, whether and how the last years’ disruptive impact on the overall ability to support its customers can be reduced and, by doing so endeavor to avoid undue impacts on the access of the people of Iran to humanitarian items/basic services such as telecommunications.

During 2020, Ericsson sold communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: Mobile Communication Company of Iran (MCCI), and MTN Irancell. During 2020, Ericsson’s gross revenue (reported as net sales) related to sales to MCCI and MTN Irancell in Iran was approximately SEK 168 million. Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales was, after internal cost allocation approximately SEK 90 million during 2020.

Ericsson uses the local banks Saman Bank and Pasargad Bank for local transactions in local currency, cash management and deposits. In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank, Saman Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these five banks with respect to Ericsson’s business activities in Iran were issued during 2020. During 2020, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran, Bank Mellat and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran.

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2020. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Table of Contents

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Ericsson Software Technology Holding AB 559094-8963 Sweden 100 — 6 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,709 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson France SAS France 100 21 524 Ericsson Antenna Technology Germany GmbH Germany 100 2 21 Ericsson Germany GmbH Germany 100 1 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 3,857 Ericsson Holding International B.V. The Netherlands 100 222 3,200 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 270 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 14 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 10 Other (Europe, excluding Sweden) — — 664 Ericsson Holding II Inc. United States 100 — 25,907 Ericsson Smart Factory Inc. United States 100 — 191 Companía Ericsson S.A.C.I. Argentina 95 1) 193 99 Ericsson Canada Inc. Canada 100 8 51 Belair Networks Canada 100 108 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 363 Other (United States, Latin America) — — 121 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 3,279 10 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Kenya Limited Kenya 100 — 69 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 316 Total 68,798 Joint ventures and associated companies Concealfab Co USA 28 7 64 Leone Media Inc. USA 49 134 790 Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 1,184

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Table of Contents

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB) Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

We continuously adjust our production capacity to meet expected customer demand. During 2020, our overall capacity utilization** was around 62%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased, other than Nanjing (China). The majority of the floor space within our production facilities is used for assembly and test.

2020 2019 2018 2017 Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sweden 1 5 1 5 1 5 1 5 China 1 13.9 1 13.9 1 13.9 1 10 Estonia 1 9 1 9 1 8 1 6 Brazil 1 6.5 1 6.7 1 4.3 1 4.5 USA 1 6 0 0 0 0 0 0 Total 5 40.4 4 34.6 4 31.2 4 25.5

* Floor space in square meters does not include any warehouses or transportation areas.

** Test capacity utilization.

In March 2020, the Company opened its first fully-automated smart factory in Lewisville, TX, United States. The 300,000 square-foot smart factory began commercial operations producing millimeter-wave Street Macro base stations, which is key to Ericsson’s 5G portfolio for its North American customers. The company’s direct investment in the factory was approximately USD $100 million.

In September 2019, the Company announced that its 269,000 square-foot factory in Tallinn, Estonia, was nearing completion of its two-year digitalization transformation, in the amount of SEK 500 million, to become a 5G manufacturing facility utilizing Ericsson’s own 5G technology. The factory became fully operational during the first quarter of 2020.

The investments were financed by cash flow from operations or by the financing activities described in our Swedish Annual Report 2019 and 2020.

The information set forth under the following headings of the 2020 Swedish Annual Report is incorporated herein by reference:

• Financial Report

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Legal and regulatory risk

• Environmental, social and governance risk

The information set forth under the following headings of the 2019 Swedish Annual Report is incorporated herein by reference:

• Ericsson in Brief

• The Business

• Financials

• Board of Directors’ Report

• Business in 2019

• Financial Highlights - Capital expenditures

Table of Contents

For capital expenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Item 4C. Shares owned directly by the Parent Company ”. We are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financials–Risk Factors—Market, Technology and Business Risks”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers to capture the full value of connectivity. The company’s portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world.

The information set forth under the following headings of the 2019 Swedish Annual Report is incorporated herein by reference:

• Ericsson in Brief

• The Business

• Financials

• Board of Directors’ Report

• Business in 2019

• Financial Highlights – Capital expenditures

For capital expenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

The information set forth under the following headings of the 2019 Swedish Annual Report is incorporated herein by reference:

• Ericsson in brief

• The Business

• Business Model

• Strategy and financial targets

• Innovation – Global R&D and supply chain

• Segments

• Financials

• Board of Directors’ report

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

Table of Contents

• Business results – Segments

• Business results – Market Areas

• Sourcing and supply

• Sustainability and Corporate Responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Risks related to business activities and industry

• Risks related to Ericsson’s financial situation

• Legal and regulatory risk

• Internal control risk

• Environmental, social and governance risk

• Corporate Governance

• Corporate Governance report

• Regulation and compliance

• Sustainability

• Sustainability Management

• Significant topics, risks and opportunities

• Responsible business – Responsible management of suppliers

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Inspectorate of Strategic Products and in compliance with applicable economic sanctions and export controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, salaries, rents, utilities and office and similar supplies as well for local accommodation and transportation and customs related services. As a result, Ericsson has contact with companies and public functions that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is challenging to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

During 2019, Ericsson sold communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: Mobile Communication Company of Iran (“MCCI”), and MTN Irancell. During 2019, Ericsson’s gross revenue (reported as net sales) related to sales to MCCI and MTN Irancell in Iran was approximately SEK 908 million.

Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales was, after internal cost allocation approximately SEK 95 million during 2019. Ericsson always strives to honor its engagements with existing customers in compliance with applicable export controls, sanctions and other laws, rules and regulations, but it is clear that the extensive U.S. sanctions impact the overall possibility of doing business in Iran. Ericsson carefully evaluates the implications of any sanctions and continues to monitor developments in this area as it relates to the ability to continue delivering products and services to customers. Ericsson has reduced its business and organization in Iran but still continues to fulfill engagements with the two main mobile carriers, MCCI and MTN Irancell and to provide them with what is critical for their networks to function. As Ericsson provides these services, it may need to interact with other counterparties. Ericsson continues to explore, including with EU and US authorities, whether and how the disruptive impact on the ability to maintain and support the operations of existing networks of MCCI and MTN Irancell can be reduced and, by doing so, endeavor to avoid undue impacts on the access of the people of Iran to humanitarian items/basic services such as telecommunications.

In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these four banks with respect to Ericsson’s business activities in Iran were issued during 2019.

During 2019, existing bank guarantees issued by Maskan Bank, Parsian Bank, Post Bank of Iran and Tejarat Bank (local banks in Iran) to secure Iranian customer payment obligations to Ericsson were renewed. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran.

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2019. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Table of Contents

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Ericsson Software Technology Holding AB 559094-8963 Sweden 100 — 6 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,459 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson Participations France SAS France 100 26 524 Ericsson Antenna Technology Germany GmbH Germany 100 — 21 Ericsson Germany GmbH Germany 100 1 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 3,857 Ericsson Holding International B.V. The Netherlands 100 222 3,200 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 270 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 14 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 1,994 Other (Europe, excluding Sweden) — — 664 Ericsson Holding II Inc. United States 100 2,897 25,907 Ericsson Smart Factory Inc. United States 100 — 191 Companía Ericsson S.A.C.I. Argentina 95 1) 41 99 Ericsson Canada Inc. Canada 100 8 51 Belair Networks Canada 100 2 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 1,050 Other (United States, Latin America) — — 214 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 P.T. Ericsson Indonesia Indonesia 95 3,279 10 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Kenya Limited Kenya 100 — 88 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 157 Total 71,172 Joint ventures and associated companies Concealfab Co USA 29 7 64 Leone Media Inc. USA 49 — 790 Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 1,184

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 74% of Ericsson (Thailand) Ltd.

Table of Contents

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB) Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

We continuously adjust our production capacity to meet expected customer demand. During 2019, our overall capacity utilization** was around 60%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased. The majority of the floor space within our production facilities is used for assembly.

2019 2018 2017 2016 Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sweden 1 5 1 5 1 5 4 21.3 China 1 13.9 1 13.9 1 10 2 13 Estonia 1 9 1 8 1 6 1 6 Brazil 1 6.7 1 4.3 1 4.5 1 4.5 Mexico 0 0 0 0 0 0 1 0.8 India 0 0 0 0 0 0 1 10.8 Total 4 34.6 4 31.2 4 25.5 10 56.4

* Floor space in square meters does not include any warehouses or transportation areas.

** Test capacity utilization.

In June 2019, the Company announced plans to build its first fully-automated smart factory in the US. The 300,000 square-foot smart factory will begin commercial operations in March 2020, in Lewisville, TX. The state-of-the-art factory will produce 5G and Advanced Antenna System radios to boost network capacity and coverage to meet the demand for rapid 5G deployments in North America. The company’s direct investment in the factory is approximately USD $100 million.

In September 2019, the Company announced that its 269,000 square-foot factory in Tallinn, Estonia, was nearing completion of its two-year digitalization transformation, in the amount of SEK 500 million, to become a 5G manufacturing facility utilizing Ericsson’s own 5G technology. The factory will be fully operational during the first quarter of 2020.

In September 2019, the company announced it concluded the 18-month upgrade, in the amount of SEK 500 million, to modernize the production process (of 5G and 4G radio technology products) in its smart factory in Nanjing, China, in preparation for the introduction and rapid deployments of 5G in China.

The investments are financed by cash flow from operations or by the financing activities described in our Swedish Annual Report 2019.

The information set forth under the following headings of the 2019 Swedish Annual Report is incorporated herein by reference:

• Financials

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leases

• Risk factors

• Legal and regulatory risk

• Environmental, social and governance risk

The information set forth under the following headings of the 2018 Swedish Annual Report is incorporated herein by reference:

• The Business

• Ericsson in Brief

• Financials

• Board of Directors’ Report

• Business in 2018

• Financial Highlights - Capital expenditures

For capital exenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

Table of Contents

• Note E2 – Business combinations

• Note H6 – Events after the reporting period

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Item 4C. Investments”. In addition to our joint venture ST-Ericsson (up until August 2, 2013), we are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financials–Risk Factors—Market, Technology and Business Risks”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers to capture the full value of connectivity. The company’s portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world.

The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC: http://www.sec.gov.

Table of Contents

The information set forth under the following headings of the 2018 Swedish Annual Report is incorporated herein by reference:

• The business

• Ericsson in brief

• This is Ericsson

• Business Model

• Strategy and financial targets

• Segments

• Supply chain

• Financials

• Board of Directors’ report

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market Areas

• Sourcing and supply

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note B1 – Segment information

• Risk factors

• Market, technology and business risks

• Regulatory, compliance and corporate governance risks

• Corporate Governance

• Corporate Governance report 2018

• Regulation and compliance

• Sustainability

• Sustainability Management

• Significant topics and risk management

Table of Contents

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Agency for Non-Proliferation and Export Controls and in compliance with applicable economic sanctions and export controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, salaries, rents, utilities and office and similar supplies as well for local accommodation and transportation and customs related services. As a result, Ericsson has contact with companies and public functions that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is challenging to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

During 2018, Ericsson sold communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: Farabord Dadehavare Iranian (“Farabord”) (relating to purchase orders received before May 2018), Mobile Communication Company of Iran (“MCCI”), and MTN Irancell. During 2018, Ericsson’s gross revenue (reported as net sales) related to sales to Farabord, MCCI and MTNIrancell in Iran was approximately SEK 990 million.

Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales was negative, after internal cost allocation approximately SEK -820 million during 2018. Ericsson always strives to honor its engagements with existing customers in compliance with applicable export controls, sanctions and other laws, rules and regulations, but it is clear that the U.S. withdrawal from the Joint Comprehensive Plan of Action (the “JCPOA”) has impacted the overall possibility of doing business in Iran. Ericsson has carefully evaluated the implications of the re-introduced sanctions (caused by the withdrawal by the US from the JCPOA) and continues to monitor developments in this area as it relates to the ability to continue delivering products and services to customers. Since the US withdrawal from the JCPOA, Ericsson is winding down its business and organization significantly but still continues to provide the two main mobile carriers, MCCI and MTN Irancell with support critical for the network to function and to fulfill engagements with these carriers entered into before May 8, 2018. As Ericsson fulfil contractual obligations with regard to contracts entered into before the US withdrawal from the JCPOA, Ericsson may, during a wind down period need to interact with other counterparties. Ericsson continues to explore, including with EU and US authorities, whether and how the disruptive impact on the ability to maintain and support the operations of existing networks of MCCI and MTN Irancell can be minimized and by doing so, endeavor to avoid undue impacts on the access of the people of Iran to humanitarian items/basic services such as telecommunications.

In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank, Parsian Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these four banks with respect to Ericsson’s business activities in Iran were issued during 2018. During the first quarter of 2018, payment was made by Ericsson, via one of Ericsson’s banks outside Iran, to Bank Mellat, under a previously issued performance bond.

Table of Contents

During 2018, existing bank guarantees issued by Bank Mellat, Maskan Bank, Parsian Bank, Post Bank of Iran and Tejarat Bank (local banks in Iran) to cover Ericsson’s obligations under customer contracts or tender rules were extended in time. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran. Ericsson also received payments from customers in Iran to Ericsson’s accounts outside Iran.

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2018. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Netwise AB 556404-4286 Sweden 100 2 306 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,494 Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson Participations France SAS France 100 26 524 Ericsson Germany GmbH Germany 100 — 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 3,857 Ericsson Holding International B.V. The Netherlands 100 222 3,200 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 270 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 14 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 1,994 Other (Europe, excluding Sweden) — — 681 Ericsson Holding II Inc. United States 100 2,897 25,907 Companía Ericsson S.A.C.I. Argentina 95 1) 41 15 Ericsson Canada Inc. Canada 100 8 51 Belair Networks Canada 100 108 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 1,050 Other (United States, Latin America) — — 88

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Company Reg. No. Domicile Percentage ofownership Par value inlocal currency,million Carryingvalue,SEK million Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 Ericsson India Private Ltd. India 67 3) 364 82 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Media Solutions Ltd Israel 100 9 51 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 221 Total 71,201 Joint ventures and associated companies Concealfab Co USA 29 7 64 ST-Ericsson SA Switzerland 50 137 — Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 394

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 100% of Ericsson (Thailand) Ltd.

3) Through subsidiary holdings, total holdings amount to 100% of Ericsson India Private Ltd.

Company Reg. No. Domicile Percentageof ownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

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1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB) Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

The information set forth under the following headings of the 2018 Swedish Annual Report is incorporated herein by reference:

• The business

• CEO comment

• Sustainability and corporate responsibility

• Segments

• Networks

• Sustainability focus

• Digital Services

• Sustainability focus

• Managed Services

• Sustainability focus

• Emerging Business and Other

• Sustainability focus

• Financials

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note C2 – Property, plant and equipment

• Note C3 – Leasing

• Risk factors

• Regulatory, Compliance and Corporate Governance risks

• Sustainability

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• Sustainability Management

• Significant topics and risk management

We continuously adjust our production capacity to meet expected customer demand. During 2018, our overall capacity utilization was around 75%.

The table below summarizes where we have major sites and the total floor space at year-end. All facilities are leased. The majority of the floor space within our production facilities is used for assembly.

2018 2017 2016 2015 Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sites Thousandsof sq meters* Sweden 1 5 1 5 4 21.3 4 21.3 China 1 13.9 1 10 2 13 2 13 Estonia 1 8 1 6 1 6 1 6 Brazil 1 4.3 1 4.5 1 4.5 1 4.5 Mexico 0 0 0 0 1 0.8 1 0.8 India 0 0 0 0 1 10.8 1 10.8 Total 4 31.2 4 25.5 10 56.4 10 56.4

* Floor space in square meters does not include any warehouses or transportation areas.

A. History and Development of the Company

The information set forth under the following headings of the 2017 Swedish Annual Report is incorporated herein by reference:

• The Business

• Ericsson in Brief

• Financials

• Board of Directors’ Report

• Business in 2017

• Financial Highlights – Capital expenditures

For capital exenditures we usually use available cash from operations.

• Notes to the Consolidated financial statements

• Note C26 – Business combinations

• Note C32 – Events after the reporting period

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

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Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Item 4C. Investments”. In addition to our joint venture ST-Ericsson (up until August 2, 2013), we are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financials–Risk Factors - Market, Technology and Business Risks”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson enables communications service providers to capture the full value of connectivity. The company’s portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson’s investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world.

B. Business Overview

The information set forth under the following headings of the 2017 Swedish Annual Report is incorporated herein by reference:

• The business

• Ericsson in brief

• This is Ericsson

• Strategy and financial targets

• Segments

• Business Model

• Financials

• Board of Directors’ report

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Market Areas

• Sourcing and supply

• Sustainability and corporate responsibility

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• Notes to the consolidated financial statements

• Note C3 – Segment information

• Risk factors

• Market, technology and business risks

• Regulatory, compliance and corporate governance risks

• Corporate Governance

• Corporate Governance report 2017

• Regulation and compliance

• Sustainability

• Sustainability and corporate responsibility

Sustainability and corporate responsibility are integrated into Ericsson’s business processes and the Company’s commitment to the triple bottom line of responsible environmental performance and social and economic development is made clear to its stakeholders.

Ericsson’s ambition is to be a responsible and relevant driver of positive change in society. Ericsson is committed to creating business value while reducing risk related to environmental, social, employee, human rights, corruption and bribery matters. Ericsson’s sustainability and corporate responsibility performance is regularly measured, assessed and assured. Group policies and directives have been implemented to ensure consistency across global operations.

Ericsson’s principal risks relating to sustainability and corporate responsibility are identified in Ericsson’s risk management framework.

The Board of Directors is briefed on sustainability and corporate responsibility issues regularly, or as needed on an ad hoc basis.

In 2017, the Chief Sustainability & Public Affairs Officer was a member of Ericsson’s Executive Team and reported to the President and CEO, and was responsible for handling the day-to-day management of Ericsson’s sustainability and corporate responsibility agenda.

• Governance and policies

Responsible business practices are embedded in Ericsson’s operations to prevent, mitigate and adapt to risks. The Ericsson Group Management System (EGMS) includes policies, processes and directives encompassing responsible sourcing, occupational health and safety, environmental management, anti-corruption and human rights, for example. External assurance providers audit the EGMS.

Some of the Group Policies and Directives that are of particular relevance from a sustainability and corporate responsibility perspective are the Code of Business Ethics, the Code of Conduct, the Sustainability Policy, the Occu-pational Health and Safety Policy, the Electro-magnetic Fields and Health Policy, the Sales Compliance Policy and the Anti-corruption Group Directive, which reflect how Ericsson shall work to secure responsible business practices. These policies and practices are reinforced by employee awareness training and monitoring. Compliance to Group Policies are mandatory for all employees and operations unless a deviation is approved by the CEO.

The Code of Business Ethics

The Code of Business Ethics sets the tone for how Ericsson conducts business globally, and is a guiding framework to support everyone performing work for Ericsson. The Code of Business Ethics is periodically reviewed and acknowledged by employees and has been translated into more than 30 languages to ensure that it is accessible to all employees and stakeholders. During 2017, 99% of active employees acknowledged that they have read and understood the Code of Business Ethics.

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Employees are encouraged to report any conduct that they believe, in good faith, to be a violation of laws or the Code of Business Ethics. Ericsson provides employees and external stakeholders with a dedicated communication channel, called the Ericsson Compliance Line, for the reporting of serious compliance concerns involving group or local management and which relates to;

a) corruption or fraud

b) questionable accounting or auditing matters

c) other matters that might seriously affect the vital interest of Ericsson or personal health and safety.

The process around reporting of violations has been strengthened and further developed to include both centrally and locally reported allegations of violations in 2017. For this reason there is a significantly higher number of reports in 2017 in comparison with 2016.

During 2017 the Company received 412 cases reported through Ericsson’s whistle-blower tool, the Ericsson Compliance Line. This tool is available via phone or secure website, 24/7, 365 days a year, and is available in

188 countries and in over 75 languages.

Reported violations are handled by Ericsson’s Group Compliance Forum, which consists of representatives from Ericsson’s internal audit function, Group Function Legal Affairs, Group Security, and Group Function Human Resources. The Forum briefs the Audit Committee about all reported violations, providing them with the incident category, a description of the alleged violation, and information about the decision and outcome.

The Code of Conduct

Ericsson’s Code of Conduct applies to employees and suppliers and is based on the UN Global Compact ten principles on human rights, labor conditions, environmental management and anti-corruption. Ericsson is also committed to implementing the UN Guiding Principles on Business and Human Rights across its business operations.

Suppliers must comply with Ericsson’s Code of Conduct requirements. The Company uses a risk-based approach to assess compliance with the Code of Conduct requirements as part of supplier agreements. The Company has a strong focus on risk mitigation, targeting high-risk portfolio areas and high-risk markets. For prioritized areas such as road and vehicle safety, working at heights, working hours and labor rights, Ericsson performs regular audits and works with suppliers to ensure measurable and continuous improvements, and has also introduced consequence management. Findings are followed up to ensure that improvements are made.

Since 2017, the Ethics and Compliance Board – comprised of several members of the Executive Team and chaired by the CEO – has been responsible to oversee the overall governance of compliance within the Group.

• Sustainability risk management

Sustainability risks are defined according to short-term and long-term perspectives. They are related to long-term objectives as per the strategic direction as well as short-term objectives for the coming year. According to Ericsson’s risk framework, sustainability risks are categorized into industry and market risks, commercial risks, operational risks and compliance risks. The Company follow its risk management principles, which apply across all business activities, to manage sustainability risks.

Materiality assessment is a central component of the Company’s sustainability and corporate responsibility strategy, target setting, risks and opportunities management, and reporting process related to its impact on society and environment. Ericsson considers a wide range of economic, environmental and social impacts significant to the business, or which substantively influence the views and decisions of our key stakeholders. Since 2012, the Company has used a materiality assessment to review significant issues on an annual basis, taking into account emerging trends, stakeholder feedback and other input. Adjustments are made as needed to incorporate critical issues as they arise.

The Group Function Sustainability and Public Affairs coordinates management of certain sustainability risks, such as occupational health and safety, human rights, and environmental related risks. Risks related to corruption are coordinated by Group Function Legal Affairs, and diversity issues are coordinated by Group Function Human Resources.

For information on risks that could impact the fulfillment of targets and form the basis for mitigating activities, see the Swedish Annual Report 2017, Note C20 “Financial risk management and financial instruments” and the Risk Factors section in the Board of Directors’ report in the Swedish Annual Report 2017.

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• Anti-corruption

Corruption carries serious legal and reputational risks; impedes business growth; damages relations with staff, customers, shareholders, suppliers and society as a whole; and is a considerable obstacle to economic and social development in countries around the world. With customers in 180 countries, many of which are considered to be exposed to a high risk of corruption, prevention and accountability are paramount for Ericsson.

Ericsson has a zero-tolerance approach to corruption expressed in the Company’s Code of Business Ethics. The Company has embedded this guiding principle at its highest levels and implemented it throughout its global organization with a set of policies and processes. This includes an anti-corruption directive with more detailed guidelines, for example about appropriate levels of gifts and entertainment.

The Company’s anti-corruption program, focusing on prevention and accountability, is headed by a Chief Compliance Officer, who since October 2017 reports directly to the Audit Committee of the Board of Directors. The Audit Committee also reviews and evaluates the program at least annually. Further, since 2016, an Ethics and Compliance Board, comprised of several members of the Executive Team and chaired by the CEO, has been responsible for the overall governance of compliance within the Group.

During 2016–2017 we invited external experts to evaluate the robustness of our anti-corruption program. Following the review, we adjusted the anti-corruption program to closer align with the US Foreign Corrupt Practices Act (FCPA). In 2017, the program was strengthened with adding resources on group level and appointing Regional Compliance Officers in all Market Areas. Moreover, one of the elements of the Group targets for sustainability and corporate responsibility is anti-corruption.

In 2017 the Company continued to roll out an automated anti-corruption screening tool for supplier and third party due diligence, which was launched in 2016. By the end of 2017, close to 93% of active employees had completed the Company’s anti-corruption e-learning course since the training was launched in 2013. A customized online anti-corruption training is also available for Ericsson’s suppliers on the Company website.

In 2017, Ericsson introduced a vetting process that focuses on ethics and compliance. So far we have used it for appointments to the Executive Team and for approximately 110 employees in exposed positions. All members of the current Executive Team have been vetted, and all future recruitments to these positions will also go through mandatory vetting. Business Partner Review Boards have been established in all Market Areas to over-see mitigation of the corruption risks in relation to onboarding of new business partners.

Ericsson is currently voluntarily cooperating with inquiries from the United States Securities and Exchange Commission and the United States Department of Justice regarding its compliance with the U.S. Foreign Corrupt Practices Act. As of today, these inquiries concern a period from January 1, 2007 and onwards, and the Company will make additional disclosures regarding these inquiries to the extent required.

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Agency for Non-Proliferation and Export Controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, salaries, rents, utilities and office and similar supplies as well for local accommodation and transportation and customs related services. As a result, Ericsson has contact with companies and public functions that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is difficult to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

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During 2017, Ericsson sold communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: Farabord Dadehavare Iranian (“Farabord”), Hiweb, Mobile Communication Company of Iran (“MCCI”), MTNIrancell and Pars Online. During 2017, Ericsson and Telecommunications Company of Iran (“TCI”) has had discussions relating to potential future such sales by Ericsson to TCI. During 2017, Ericsson’s gross revenue (reported as net sales) related to sales to Farabord, Hiweb, MCCI and MTNIrancell and Pars Online in Iran was approximately SEK 1,945 million.

Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales, after internal cost allocation was approximately SEK -117 million during 2017. Ericsson intends to continue to engage with existing customers and explore opportunities with new customers in Iran while continuously monitoring international developments as they relate to Iran and its government.

In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Bank Mellat, Tejarat Bank, Melli Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these four banks with respect to Ericsson’s business activities in Iran were issued during 2017, nor were payments made to beneficiaries under any such existing bond or guarantee during 2017.

During 2017, Maskan Bank, Post Bank of Iran and Tejarat Bank (local banks in Iran) issued bank guarantees to secure Iranian customer payment obligations to Ericsson. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks that may be controlled by the government of Iran. Ericsson also received payments from customers to Ericsson’s accounts outside Iran.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2017. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Company Reg. No. Domicile Percentageofownership Par valuein localcurrency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Netwise AB 556404-4286 Sweden 100 2 306 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,645

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Company Reg. No. Domicile Percentageofownership Par valuein localcurrency,million Carryingvalue,SEK million Ericsson Austria GmbH Austria 100 4 94 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson Participations France SAS France 100 26 524 Ericsson Germany GmbH Germany 100 — 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 3,857 Ericsson Holding International B.V. The Netherlands 100 222 3,200 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 270 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 170 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 1,994 Other (Europe, excluding Sweden) — — 684 Ericsson Holding II Inc. United States 100 2,897 25,907 Companía Ericsson S.A.C.I. Argentina 95 1) 41 15 Ericsson Canada Inc. Canada 100 — 51 Belair Networks Canada 100 108 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 1,050 Other (United States, Latin America) — — 118 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 Ericsson India Private Ltd. India 100 544 122 Ericsson India Global Services PVT. Ltd India 100 291 51 Ericsson Media Solutions Ltd Israel 100 9 711 Ericsson-LG CO Ltd. Korea 75 285 2,279 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 295 Total 72,316 Joint ventures and associated companies ST-Ericsson SA Switzerland 50 137 — Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 330

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 100% of Ericsson (Thailand) Ltd.

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Company Reg. No. Domicile Percentageofownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Drutt Corporation Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 83 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB)

Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

D. Property, Plant and Equipment

The information set forth under the following headings of the 2017 Swedish Annual Report is incorporated herein by reference:

• The business

• Sustainability and corporate responsibility

• Financials

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• Board of Directors’ report

• Financial highlights – Capital expenditures

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note C11 – Property, plant and equipment

• Note C27 – Leasing

• Risk factors

• Regulatory, Compliance and Corporate Governance risks

• Sustainability

• Sustainability and corporate responsibility

Sustainability and corporate responsibility are integrated into Ericsson’s business processes and the Company’s commitment to the triple bottom line of responsible environmental performance and social and economic development is made clear to its stakeholders.

Ericsson’s ambition is to be a responsible and relevant driver of positive change in society. Ericsson is committed to creating business value while reducing risk related to environmental, social, employee, human rights, corruption and bribery matters. Ericsson’s sustainability and corporate responsibility performance is regularly measured, assessed and assured. Group policies and directives have been implemented to ensure consistency across global operations.

Ericsson’s principal risks relating to sustainability and corporate responsibility are identified in Ericsson’s risk management framework.

The Board of Directors is briefed on sustainability and corporate responsibility issues regularly, or as needed on an ad hoc basis.

In 2017, the Chief Sustainability & Public Affairs Officer was a member of Ericsson’s Executive Team and reported to the President and CEO, and was responsible for handling the day-to-day management of Ericsson’s sustainability and corporate responsibility agenda.

• Governance and policies

Responsible business practices are embedded in Ericsson’s operations to prevent, mitigate and adapt to risks. The Ericsson Group Management System (EGMS) includes policies, processes and directives encompassing responsible sourcing, occupational health and safety, environmental management, anti-corruption and human rights, for example. External assurance providers audit the EGMS.

Some of the Group Policies and Directives that are of particular relevance from a sustainability and corporate responsibility perspective are the Code of Business Ethics, the Code of Conduct, the Sustainability Policy, the Occupational Health and Safety Policy, the Electro-magnetic Fields and Health Policy, the Sales Compliance Policy and the Anti-corruption Group Directive, which reflect how Ericsson shall work to secure responsible business practices. These policies and practices are reinforced by employee awareness training and monitoring. Compliance to Group Policies are mandatory for all employees and operations unless a deviation is approved by the CEO.

The Code of Business Ethics

The Code of Business Ethics sets the tone for how Ericsson conducts business globally, and is a guiding framework to support everyone performing work for Ericsson. The Code of Business Ethics is periodically reviewed and acknowledged by employees and has been translated into more than 30 languages to ensure that it is accessible to all employees and stakeholders. During 2017, 99% of active employees acknowledged that they have read and understood the Code of Business Ethics.

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Employees are encouraged to report any conduct that they believe, in good faith, to be a violation of laws or the Code of Business Ethics. Ericsson provides employees and external stakeholders with a dedicated communication channel, called the Ericsson Compliance Line, for the reporting of serious compliance concerns involving group or local management and which relates to;

a) corruption or fraud

b) questionable accounting or auditing matters

c) other matters that might seriously affect the vital interest of Ericsson or personal health and safety.

The process around reporting of violations has been strengthened and further developed to include both centrally and locally reported allegations of violations in 2017. For this reason there is a significantly higher number of reports in 2017 in comparison with 2016.

During 2017 the Company received 412 cases reported through Ericsson’s whistle-blower tool, the Ericsson Compliance Line. This tool is available via phone or secure website, 24/7, 365 days a year, and is available in

188 countries and in over 75 languages.

Reported violations are handled by Ericsson’s Group Compliance Forum, which consists of representatives from Ericsson’s internal audit function, Group Function Legal Affairs, Group Security, and Group Function Human Resources. The Forum briefs the Audit Committee about all reported violations, providing them with the incident category, a description of the alleged violation, and information about the decision and outcome.

The Code of Conduct

Ericsson’s Code of Conduct applies to employees and suppliers and is based on the UN Global Compact ten principles on human rights, labor conditions, environmental management and anti-corruption. Ericsson is also committed to implementing the UN Guiding Principles on Business and Human Rights across its business operations.

Suppliers must comply with Ericsson’s Code of Conduct requirements. The Company uses a risk-based approach to assess compliance with the Code of Conduct requirements as part of supplier agreements. The Company has a strong focus on risk mitigation, targeting high-risk portfolio areas and high-risk markets. For prioritized areas such as road and vehicle safety, working at heights, working hours and labor rights, Ericsson performs regular audits and works with suppliers to ensure measurable and continuous improvements, and has also introduced consequence management. Findings are followed up to ensure that improvements are made.

Since 2017, the Ethics and Compliance Board – comprised of several members of the Executive Team and chaired by the CEO – has been responsible to oversee the overall governance of compliance within the Group.

• Sustainability risk management

Sustainability risks are defined according to short-term and long-term perspectives. They are related to long-term objectives as per the strategic direction as well as short-term objectives for the coming year. According to Ericsson’s risk framework, sustainability risks are categorized into industry and market risks, commercial risks, operational risks and compliance risks. The Company follow its risk management principles, which apply across all business activities, to manage sustainability risks.

Materiality assessment is a central component of the Company’s sustainability and corporate responsibility strategy, target setting, risks and opportunities management, and reporting process related to its impact on society and environment. Ericsson considers a wide range of economic, environmental and social impacts significant to the business, or which substantively influence the views and decisions of our key stakeholders. Since 2012, the Company has used a materiality assessment to review significant issues on an annual basis, taking into account emerging trends, stakeholder feedback and other input. Adjustments are made as needed to incorporate critical issues as they arise.

The Group Function Sustainability and Public Affairs coordinates management of certain sustainability risks, such as occupational health and safety, human rights, and environmental related risks. Risks related to corruption are coordinated by Group Function Legal Affairs, and diversity issues are coordinated by Group Function Human Resources.

For information on risks that could impact the fulfillment of targets and form the basis for mitigating activities, see the Swedish Annual Report 2017, Note C20 “Financial risk management and financial instruments” and the Risk Factors section in the Board of Directors’ report in the Swedish Annual Report 2017.

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• Anti-corruption

Corruption carries serious legal and reputational risks; impedes business growth; damages relations with staff, customers, shareholders, suppliers and society as a whole; and is a considerable obstacle to economic and social development in countries around the world. With customers in 180 countries, many of which are considered to be exposed to a high risk of corruption, prevention and accountability are paramount for Ericsson.

Ericsson has a zero-tolerance approach to corruption expressed in the Company’s Code of Business Ethics. The Company has embedded this guiding principle at its highest levels and implemented it throughout its global organization with a set of policies and processes. This includes an anti-corruption directive with more detailed guidelines, for example about appropriate levels of gifts and entertainment.

The Company’s anti-corruption program, focusing on prevention and accountability, is headed by a Chief Compliance Officer, who since October 2017 reports directly to the Audit Committee of the Board of Directors. The Audit Committee also reviews and evaluates the program at least annually. Further, since 2016, an Ethics and Compliance Board, comprised of several members of the Executive Team and chaired by the CEO, has been responsible for the overall governance of compliance within the Group.

During 2016–2017 we invited external experts to evaluate the robustness of our anti-corruption program. Following the review, we adjusted the anti-corruption program to closer align with the US Foreign Corrupt Practices Act (FCPA). In 2017, the program was strengthened with adding resources on group level and appointing Regional Compliance Officers in all Market Areas. Moreover, one of the elements of the Group targets for sustainability and corporate responsibility is anti-corruption.

In 2017 the Company continued to roll out an automated anti-corruption screening tool for supplier and third party due diligence, which was launched in 2016. By the end of 2017, close to 93% of active employees had completed the Company’s anti-corruption e-learning course since the training was launched in 2013. A customized online anti- corruption training is also available for Ericsson’s suppliers on the Company website.

In 2017, Ericsson introduced a vetting process that focuses on ethics and compliance. So far we have used it for appointments to the Executive Team and for approximately 110 employees in exposed positions. All members of the current Executive Team have been vetted, and all future recruitments to these positions will also go through mandatory vetting. Business Partner Review Boards have been established in all Market Areas to over-see mitigation of the corruption risks in relation to onboarding of new business partners.

Ericsson is currently voluntarily cooperating with inquiries from the United States Securities and Exchange Commission and the United States Department of Justice regarding its compliance with the U.S. Foreign Corrupt Practices Act. As of today, these inquiries concern a period from January 1, 2007 and onwards, and the Company will make additional disclosures regarding these inquiries to the extent required.

We continuously adjust our production capacity to meet expected customer demand. During 2017, our overall capacity utilization was around 85%.

The table below summarizes where we have major sites and the total floor space at year-end. Facilities are leased. The majority of the floor space within our production facilities is used for assembly.

2017 2016 2015 Sites* Thousandsofsqmeters** Sites Thousandsof sqmeters** Sites Thousandsof sqmeters** Sweden 1 5 4 21.3 4 21.3 China 1 10 2 13 2 13 Estonia 1 6 1 6 1 6 Brazil 1 4.5 1 4.5 1 4.5 Mexico 0 0 1 0.8 1 0.8 India 0 0 1 10.8 1 10.8 Total 4 25.5 10 56.4 10 56.4

* In 2017, we closed 3 facilities in Sweden, 1 in China, 1 in Mexico and 1 in India.

** Floor space in square meters does not include any warehouses or transportation areas.

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A. History and Development of the Company

The information set forth under the following headings of the 2016 Swedish Annual Report is incorporated herein by reference:

• The Business

• Ericsson in Brief

• Change in Reporting Structure from 2017

• Financials – Board of Directors’ Report

• Business in 2016

• Financial Highlights – Capital expenditures

For capital expenditures we usually use available cash from operations

• Notes to the Consolidated financial statements

• Note C26 – Business combinations

• Note C32 – Events after the reporting period

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Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a list of our significant subsidiaries, please see “Item 4C. Investments”. In addition to our joint venture ST-Ericsson (up until August 2, 2013), we are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Financials–Risk Factors - Market, Technology and Business Risks”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson is a leading provider of communications equipment, telecom services and support solutions. Our customers, in over 180 countries, are mainly operators of communications networks worldwide. We manage networks, or parts of networks, for one billion subscribers.

B. Business Overview

The information set forth under the following headings of the 2016 Swedish Annual Report is incorporated herein by reference:

• Ericsson in brief

Table of Contents

• The business

• This is Ericsson

• This is the market

• The customers

• Networks

• IT & Cloud

• Media

• Global presence 24/7

• Customer group Industry and Society

• Customer Group – IPR & Licensing

• Reporting Structure 2016

• Change in Reporting Structure from 2017

• Financials

• Board of Directors’ report

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Regions

• Sourcing and supply

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note C3 – Segment information

• Risk factors

• Market, technology and business risks

• Regulatory, compliance and corporate governance risks

• Corporate Governance

• Corporate Governance report 2016

• Regulation and compliance

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Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of communications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Agency for Non-Proliferation and Export Controls.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, salaries, rents, utilities and office and similar supplies as well for local accommodation and transportation and customs related services. As a result, Ericsson has contact with companies that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran through its policies and procedures designed to ensure that Ericsson “knows its customers”, it is difficult to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

During 2016, Ericsson sold communications infrastructure related products and services in Iran to the following telecommunications companies operating in the country: MTNIrancell, Mobile Communication Company of Iran (“MCCI”) and Dadeh Gostare Asre Novin (“Hiweb”). Ericsson also contracted with Pars Online for such sales. During 2016, Ericsson’s gross revenue (reported as net sales) related to sales to Hiweb, MTNIrancell and MCCI in Iran was approximately SEK 2,801 million. Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales, after internal cost allocation was approximately SEK - 332 million during 2016. Ericsson intends to continue to engage with existing customers and explore opportunities with new customers in Iran while continuously monitoring international developments as they relate to Iran and its government.

In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these three banks with respect to Ericsson’s business activities in Iran were issued during 2016, nor were payments made to beneficiaries under any such existing bond or guarantee.

During 2016, Bank Mellat, Post Bank of Iran and Tejarat Bank (local banks in Iran) issued bank guarantees to secure Iranian customer payment obligations to Ericsson and Eghtesad Novin Bank (a local bank in Iran) issued a letter of credit to one of Ericsson’s banks outside Iran, to secure an Iranian customer’s payment obligations to Ericsson. Further, some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks controlled by the government of Iran, such as Bank Mellat, Tejarat Bank, Bank Melli, Saderat Bank, Keshavarzi Bank, Eghtesad Novin Bank, Refah Bank and Bank Sepah. Ericsson also received payments from customers to Ericsson’s accounts outside Iran.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2016. A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

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Company Reg. No. Domicile Percentageofownership Par valuein localcurrency,million Carryingvalue,SEK million Subsidiary companies Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Netwise AB 556404-4286 Sweden 100 2 306 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,642 Ericsson Austria GmbH Austria 100 4 65 Ericsson Danmark A/S Denmark 100 90 216 Oy LM Ericsson Ab Finland 100 13 196 Ericsson Participations France SAS France 100 26 524 Ericsson Germany GmbH Germany 100 — 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 5,357 Ericsson Holding International B.V. The Netherlands 100 222 3,200 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 1,670 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 170 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. United Kingdom 100 328 4,094 Other (Europe, excluding Sweden) — — 680 Ericsson Holding II Inc. United States 100 2,897 29,907 Companía Ericsson S.A.C.I. Argentina 95 1) 41 15 Ericsson Canada Inc. Canada 100 — 51 Belair Networks Canada 100 — 170 Ericsson Telecom S.A. de C.V. Mexico 100 939 1,050 Other (United States, Latin America) — — 96 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 Ericsson India Private Ltd. India 100 725 147 Ericsson India Global Services PVT. Ltd India 100 389 64 Ericsson Media Solutions Ltd Israel 100 9 711 Ericsson-LG CO Ltd. Korea 75 375 2,544 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 70 — 135 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 299 Total 81,564 Joint ventures and associated companies ST-Ericsson SA Switzerland 50 137 — Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 330

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 100% of Ericsson (Thailand) Ltd.

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Company Reg. No. Domicile Percentageofownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100 Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Creative Broadcast Services Holdings Ltd. United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Drutt Corporation Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 100 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB) Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

D. Property, Plant and Equipment

The information set forth under the following headings of the 2016 Swedish Annual Report is incorporated herein by reference:

• The business

• Sustainability and corporate responsibility

• Financials

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Sustainability and corporate responsibility

Table of Contents

• Notes to the consolidated financial statements

• Note C11 – Property, plant and equipment

• Note C27 – Leasing

• Risk factors

• Regulatory, Compliance and Corporate Governance risks

We continuously adjust our production capacity to meet expected customer demand. During 2016, our overall capacity utilization was around 85%.

The table below summarizes where we have major sites and the total floor space at year-end. Facilities are leased. The majority of the floor space within our production facilities is used for assembly.

2016 2015 2014 Sites Thousandsofsqmeters** Sites* Thousandsof sqmeters** Sites Thousandsof sqmeters** Sweden 4 21.3 4 21.3 4 20.7 China 2 13 2 13 3 19.8 Estonia 1 6 1 6 1 9.1 Italy 0 0 0 0 1 16 Brazil 1 4.5 1 4.5 1 25.3 Mexico 1 0.8 1 0.8 1 0.8 India 1 10.8 1 10.8 1 24.5 Total 10 56.4 10 56.4 12 116.2

* In 2015, we closed our facility in Italy and one facility in China.

** Floor space in square meters does not include any warehouses and any transportation areas

A. History and Development of the Company

The information set forth under the following headings of the 2015 Swedish Annual Report is incorporated herein by reference:

• The Business

• Ericsson in brief

• Targeted areas – IP Networks

• Results

• Board of Directors’ Report

• Business in 2015

• Financial highlights – Capital expenditures

• Notes to the Consolidated financial statements

• Note C26 – Business combinations

• Note C32 – Events after the reporting period

Legal and commercial name of the Parent Company: Telefonaktiebolaget LM Ericsson (publ).

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Legal form of the Parent Company: A Swedish limited liability company, organized under the Swedish Companies Act.

Country of incorporation: Sweden.

Date of incorporation: The Parent Company was incorporated on August 18, 1918, as a result of a merger between AB LM Ericsson & Co. and Stockholms Allmänna Telefon AB.

Domicile: Our registered office is Telefonaktiebolaget LM Ericsson, SE–164 83 Stockholm, Sweden. Our headquarters are located at Torshamnsgatan 21, Kista, Sweden.

Website: www.ericsson.com. The information included on our website is not incorporated herein by reference.

Agent in the US: Ericsson Inc., Vice President Legal Affairs, 6300 Legacy Drive, Plano, Texas 75024. Telephone number: +1 972 583 0000.

Shares: Ericsson’s Class A and Class B shares are traded on Nasdaq Stockholm. In the US, our American Depository Shares (ADS), each representing one underlying Class B share, are traded on NASDAQ New York.

Parent company operations: The business of the parent company, Telefonaktiebolaget LM Ericsson, consists mainly of corporate management, holding company functions and internal banking activities. Our parent company operations also include customer credit management activities performed by Ericsson Credit AB on a commission basis.

Subsidiaries and associated companies: For a listing of our significant subsidiaries, please see “Item 4C. Investments”. In addition to our joint venture ST-Ericsson (up until August 2, 2013), we are engaged in a number of minor joint ventures and cooperative arrangements. For more information regarding risks associated with joint ventures, strategic alliances and third-party agreements, please see “Item 3D. Results–Risk Factors - Market, Technology and Business Risks”.

Innovating to empower people, business and society

Our origins date back to 1876 when Alexander Graham Bell filed a patent application in the United States for the telephone. The same year, Lars Magnus Ericsson opened a small workshop in Stockholm to repair telegraph instruments and sell his own telephone equipment.

Today, Ericsson is a leading provider of communications equipment, telecom services and support solutions. Our customers, in over 180 countries, are mainly operators of communications networks worldwide. We manage networks, or parts of networks, for one billion subscribers.

B. Business Overview

The information set forth under the following headings of the 2015 Swedish Annual Report is incorporated herein by reference:

• The business

• Ericsson in brief

• This is Ericsson

• Business structure

Table of Contents

• Global presence 24/7

• The IPR portfolio

• Market transformation

• Core business

• Targeted areas

• Results

• Board of Directors’ report

• Financial highlights – Research and development, patents and licensing

• Financial highlights – Seasonality

• Business results – Segments

• Business results – Regions

• Sourcing and supply

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note C3 – Segment information

• Risk factors

• Market, technology and business risks

• Regulatory, compliance and corporate governance risks

• Corporate Governance

• Corporate Governance report 2015

• Regulation and compliance

Ericsson has conducted business in Iran/Persia since the late nineteenth century, opened an office in Iran in 1973 and later established a local subsidiary in the country. Ericsson strongly believes in enabling communication for all and believes that access to communications can enable the right to health, education and freedom of expression. Ericsson’s business activities in Iran principally involve the sale of telecommunications infrastructure related products and services, including support, installation and maintenance services. Ericsson’s exports from the European Union (the “EU”) to Iran are performed under export licenses from the Swedish Agency for Non-Proliferation and Export Controls. The EU sanctions towards Iran grant an exemption for the supply of certain telecommunications equipment and software based on which these export licenses are granted.

Due to its operations in Iran, and having staff permanently in the country, Ericsson has contacts with its local customers and retains certain local suppliers, including banks, and service providers. In addition, Ericsson has other dealings incidental to its local activities, such as making payments for taxes, salaries, rents, utilities and office and

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similar supplies and customs related services. As a result, Ericsson has contact with companies that may be owned or controlled by the government of Iran. While Ericsson seeks to obtain information regarding the actual business names and ownership of customers and other counterparties in Iran, it is sometimes difficult to determine ownership and control with certainty, particularly with respect to determining whether an entity engaged in commercial activities is owned or controlled by the government.

During 2015, Ericsson sold telecommunications infrastructure related products and services in Iran to telecommunications companies operating in the country; MTNIrancell, Mobile Communication Company of Iran (“MCCI”) and Dadeh Gostare Asre Novin (“Hiweb”), and contracted with Sherkate Khadamate Ertebati Rightel (“Rightel”) for such sales. During 2015, Ericsson’s gross revenue (reported as net sales) related to sales to Hiweb, MTNIrancell and MCCI in Iran was approximately SEK 2,600 million. Ericsson does not normally allocate net profit (reported as net income) on a country-by-country or activity-by-activity basis, other than as set forth in Ericsson’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB. However, Ericsson has estimated that its operating income (income before taxes and financial net) from such sales, after internal cost allocation was less than SEK 639 million during 2015. Ericsson intends to continue to engage with existing customers and explore opportunities with new customers in Iran while continuously monitoring international developments as they relate to Iran and its government.

In some instances, Ericsson has had to arrange performance bonds or similar financial guarantees to secure Ericsson’s performance of obligations under the commercial agreements Ericsson has entered into relating to the business in Iran. In such instances, Ericsson usually engages its banks outside Iran, who in turn engage local banks in the country. These local banks include Tejarat Bank, Melli Bank and Saderat Bank. Although some bonds and guarantees are still in place, no new performance bonds or similar guarantees involving these three banks with respect to Ericsson’s business activities in Iran were issued during 2015, nor were payments made to beneficiaries under any such existing bond or guarantee.

Some payments made to Ericsson’s local subsidiary and payments required to be made by the local subsidiary to suppliers involve banks controlled by the government of Iran, such as Bank Mellat, Tejarat Bank, Bank Melli, Saderat Bank, Keshavarzi Bank, Eghtesad Novin Bank, Refah Bank and Bank Sepah. Ericsson also received payments from customers to Ericsson’s accounts outside Iran.

C. Organizational Structure

The following list shows certain shareholdings owned directly and indirectly by our parent company as of December 31, 2015.

A complete list of shareholdings, prepared in accordance with the Swedish Annual Accounts Act and filed with the Swedish Companies Registration Office (Bolagsverket), may be obtained upon request to: Telefonaktiebolaget LM Ericsson, External Reporting, SE-164 83 Stockholm, Sweden.

Subsidiary Company Reg. No. Domicile Percentageofownership Par valuein localcurrency,million Carryingvalue,SEK million Ericsson AB 556056-6258 Sweden 100 50 20,731 Ericsson Shared Services AB 556251-3266 Sweden 100 361 2,216 Netwise AB 556404-4286 Sweden 100 2 306 Datacenter i Rosersberg AB 556895-3748 Sweden 100 — 88 Datacenter i Mjärdevi Aktiebolag 556366-2302 Sweden 100 10 69 AB Aulis 556030-9899 Sweden 100 14 6 Ericsson Credit AB 556326-0552 Sweden 100 5 5 Other (Sweden) — — 1,64 Ericsson Austria GmbH Austria 100 4 65 Ericsson Danmark A/S Denmark 100 90 216

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Oy LM Ericsson Ab Finland 100 13 196 Ericsson Participations France SAS France 100 26 524 Ericsson Germany GmbH Germany 100 — 4,232 Ericsson Hungary Ltd. Hungary 100 1,301 120 LM Ericsson Holdings Ltd. Ireland 100 2 15 L M Ericsson Limited Ireland 100 4 34 Ericsson Telecomunicazioni S.p.A. Italy 100 44 5,357 Ericsson Holding International B.V. TheNetherlands 100 222 3,199 Ericsson A/S Norway 100 75 114 Ericsson Television AS Norway 100 161 1,729 Ericsson Corporatia AO Russia 100 5 5 Ericsson España S.A. Spain 100 43 170 Ericsson AG Switzerland 100 — — Ericsson Holdings Ltd. UnitedKingdom 100 328 4,094 Other (Europe, excluding Sweden) — — 269 Ericsson Holding II Inc. United States 100 2,896 29,006 Companía Ericsson S.A.C.I. Argentina 95 1) 41 15 Ericsson Canada Inc. Canada 100 — 51 Belair Networks Canada 100 — 170 Ericsson Telecom S.A. de C.V. Mexico 100 — 1,05 Other (United States, Latin America) — — 166 Teleric Pty Ltd. Australia 100 20 100 Ericsson Ltd. China 100 2 2 Ericsson (China) Company Ltd. China 100 65 475 Ericsson India Private Ltd. India 100 725 147 Ericsson India Global Services PVT. Ltd India 100 389 64 Ericsson Media Solutions Ltd Israel 100 — 711 Ericsson-LG CO Ltd. Korea 75 600 3,114 Ericsson (Malaysia) Sdn. Bhd. Malaysia 70 2 4 Ericsson Telecommunications Pte. Ltd. Singapore 100 2 1 Ericsson South Africa PTY. Ltd South Africa 75 — 144 Ericsson Taiwan Ltd. Taiwan 90 270 36 Ericsson (Thailand) Ltd. Thailand 49 2) 90 17 Other countries (the rest of the world) — — 255 Total 80,928 Joint ventures and associated companies ST-Ericsson SA Switzerland 50 137 — Rockstar Consortium Group Canada 21 1 — Ericsson Nikola Tesla d.d. Croatia 49 65 330 Total 330

1) Through subsidiary holdings, total holdings amount to 100% of Compania Ericsson S.A.C.I.

2) Through subsidiary holdings, total holdings amount to 100% of Ericsson (Thailand) Ltd.

Company Reg. No. Domicile Percentageofownership Subsidiary companies Ericsson Cables Holding AB 556044-9489 Sweden 100 Ericsson France SAS France 100 Ericsson Telekommunikation GmbH 1) Germany 100

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Ericsson Telecommunicatie B.V. The Netherlands 100 Ericsson Telekomunikasyon A.S. Turkey 100 Ericsson Ltd. United Kingdom 100 Redbee Media United Kingdom 100 Ericsson Inc. United States 100 Ericsson Wifi Inc. United States 100 Drutt Corporation Inc. United States 100 Redback Networks Inc. United States 100 Telcordia Technologies Inc. United States 100 Ericsson Telecomunicações S.A. Brazil 100 Ericsson Australia Pty. Ltd. Australia 100 Ericsson (China) Communications Co. Ltd. China 100 Nanjing Ericsson Panda Communication Co. Ltd. China 51 Ericsson Japan K.K. Japan 100 Ericsson Communication Solutions Pte Ltd. Singapore 100

1) Disclosures Pursuant to Section 264b of the German Commercial Code (Handelsgesetzbuch – HGB) Applying Section 264b HGB, Ericsson Holding GmbH and Ericsson Telekommunikation GmbH, located in Frankfurt am Main/Germany, are exempted from the obligation to prepare, have audited and disclose financial statements and a management report in accordance with the legal requirements being applicable for German corporations.

D. Property, Plant and Equipment

The information set forth under the following headings of the 2015 Swedish Annual Report is incorporated herein by reference:

• The business

• Sustainability and corporate responsibility

• Results

• Board of Directors’ report

• Financial highlights – Capital expenditures

• Sustainability and corporate responsibility

• Notes to the consolidated financial statements

• Note C11 – Property, plant and equipment

• Note C27 – Leasing

• Risk factors

• Regulatory, Compliance and Corporate Governance risks

We continuously adjust our production capacity to meet expected customer demand. During 2015, our overall capacity utilization was around 85%.

The table below summarizes where we have major sites and the total floor space at year-end. Facilities are leased. The majority of the floor space within our production facilities is used for assembly.

2015 2014 2013 Sites* Thousandsofsq Sites Thousandsof sqmeters Sites Thousandsof sqmeters

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meters** Sweden 4 21.3 4 20.7 4 67.2 China 2 13 3 19.8 5 32.8 Estonia 1 6 1 9.1 1 23.7 Italy 0 0 1 16.0 1 16.0 Brazil 1 4.5 1 25.3 1 25.3 Mexico 1 0.8 1 0.8 1 0.8 India 1 10.8 1 24.5 1 24.5 Total 10 56.4 12 116.2 14 190.3

* In 2015, we closed our facility in Italy and one facility in China.

** In 2015 and 2014, floor space in square meters does not include any warehouses and any transportation areas (which are included in 2013).