Ericsson to spin off its R&D center in eastern China's Nanjing city

Editing by Kate Yuan

Ericsson announced to spin off the Nanjing R&D Center to its Finnish partner TietoEVRY in November 2021. The move is said to be related to Ericsson's declining market share in China.

The Swedish company stated that its spin-off decision aims to optimize its global R&D, increasing investment in 5G and C-RAN and cutting input in 2G, 3G, and 4G. The Nanjing R&D in eastern Jiangsu Province has more than 600 employees.

In October 2020, the Swedish government banned Chinese companies from participating in its 5G network construction for "security concerns". Ericsson CEO responded that this could affect the Swedish company's market share in China's network and digital services sectors.

Ericsson's Financial Report for the 2nd quarter of 2021 showed poor market performance, with China sales falling by 2.5 billion krona ($291.4 million). The report hurt Ericsson's stock price.