Ericsson shares rose 9.2% on news of a surprise operating profit, alongside some growing sales momentum and the wrap-up of a cost-cutting programme.
It's the second straight quarter of improvement, suggesting a strategy of emphasising profit over growth is taking hold.
The company's tracking well toward a 2020 target operating margin of 10%, according to CEO Borje Ekholm.
"We have good market traction in networks with a sales growth of 2%, particularly in North America where all major operators are preparing for 5G."
Digital Services gross margin improved to 43%. In Managed Services gross margin improved to 14%.