Ericsson AB said third-quarter profit unexpectedly fell 36 percent as sales of wireless networks trailed the company's forecasts.

Net income dropped to 4 billion kronor ($620 million) from 6.2 billion kronor a year earlier, Stockholm-based Ericsson said in a statement Tuesday.
Sales, excluding businesses that Ericsson has sold, rose 6 percent to 43.5 billion kronor, missing analysts' estimates.
Ericsson Chief Executive Officer Carl-Henric Svanberg said lower demand for network upgrades hurt margins. The company's mobile venture with Sony Corp. last week reported its first drop in profit in two years on sales of cheaper handsets.
“The unexpected development in the quarter is mainly due to a shortfall in sales in mobile network upgrades and expansions which resulted in an unfavorable business mix that also negatively affected group margins,” Svanberg said in the release.
Ericsson's earnings shortfall follows Alcatel-Lucent SA, the biggest maker of telecommunications equipment, which last month cut its 2007 sales forecast on fewer-than-anticipated orders in North America.
Siemens AG, which runs a telecommunications-equipment venture with Nokia Oyj, has also said it's not satisfied with the performance of the business.
Analysts predicted that Ericsson would earn 6.14 billion kronor on sales of 45.3 billion kronor, the average estimates in a Bloomberg survey of analysts. Ericsson was due to report earnings for the quarter on Oct. 25.
(Source: Bloomberg)