Ericsson ERIC, in collaboration with Qualcomm Incorporated QCOM, recently completed an interoperability device test on a frequency band dedicated to 5G railway communications in Europe. This breakthrough underscores the significance of ecosystem support and highlights the continuous progress toward the advancement of the Future Railway Mobile Communication System (FRMCS), an international wireless communications standard for 5G-based railway communication and applications.
As the Global System for Mobile Communications – Railway is set to be phased out by 2030, the adoption of FRMCS is expected to pave the way for 5G connectivity frameworks within railway systems. Also, the adoption of 5G New Radio Standalone technology under FRMCS will enable the introduction of 5G advanced radio access network software, ensuring that railways benefit from the full potential of 5G connectivity.
Digging Deep Into ERIC-QCOM Interoperability Device Test
During the test, the companies utilized a mobile test platform powered by the Qualcomm X85 5G Modem-RF and a specially designed Ericsson radio prototype over the n101 time division duplex or the 1900-1910 MHz band. At the heart of this 8th generation 5G platform lies the Qualcomm 5G AI Processor, an integrated AI tensor accelerator that can achieve 30% faster AI inference. It provides unrivaled performance, efficiency, speeds and spectrum flexibility. Ericsson’s development of a state-of-the-art 8x8 Massive MIMO (Multiple-Input Multiple-Output) radio for FRMCS, on the other hand, underscores its ongoing commitment to developing cutting-edge technology for mission-critical networks.
Looking forward, Ericsson is preparing for the FRMCS 5G pan-European trials, known as MORANE2, which is critical for advancing railway communications technology. Launched by the International Union of Railways, MORANE2 represents a significant step in the broader initiative to introduce FRMCS. The trials are expected to enhance rail transport capacity, digitalization and overall competitiveness within the European Union.
Does ERIC Stand to Gain From the Achievement?
With the emergence of the smartphone market and subsequent usage of mobile broadband, user demand for coverage speed and quality has increased in recent times. Ericsson is focusing on 5G system development and has undertaken many notable endeavors to position itself for market leadership on 5G.
Ericsson's innovative solutions are reshaping connectivity across sectors, from enhancing network visibility through advanced 5G deployments to revolutionizing industries with robust IoT innovations. The successful completion of this interoperability test is a testament to Ericsson’s ongoing efforts to modernize and strengthen Europe’s railway communication systems.
These developments are expected to generate incremental demand for Ericsson’s solutions, leading to higher revenues. An improved financial performance is likely to propel the stock upward.
ERIC Stock Price Performance
Shares of Ericsson have gained 50.9% over the past year compared with the industry’s growth of 47%.
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ERIC’s Zacks Rank and Stocks to Consider
Ericsson currently carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks in the broader industry have been discussed below.
InterDigital IDCC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the trailing four quarters, it delivered an earnings surprise of 158.41%. It is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company designs and develops a wide range of advanced technology solutions used in digital cellular, wireless 3G, 4G and IEEE 802-related products and networks.
Celestica Inc. CLS sports a Zacks Rank #1 at present. The company provides competitive manufacturing technology and service solutions for printed circuit assembly and system assembly, as well as post-manufacturing support to many of the world's leading original equipment manufacturers. In the trailing four quarters, it delivered an earnings surprise of 10.27%.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
