Ericsson is far less reliant on hardware than it used to be. Speaking at the company’s AGM, CEO Hans Vestberg (pictured) said hardware accounted for around a third of Ericsson’s revenue during 2013 – an enormous drop from the 73 per cent share in 1999.

Software and services, 14 years ago, comprised 27 per cent of Ericsson’s sales. Fast forward to 2013 and 43 per cent of sales come from services and 23 per cent from software.

Vestberg said the change in revenue mix was evidence that the Swedish firm had radically transformed to meet both the demands of more agile networks (which require more software for faster upgrades) and of customers wanting more intelligent services.

Ericsson’s CEO was in upbeat mood at the AGM. “It was a strong year,” he told shareholders. “We grew 5 per cent which was better than our addressable market. We improved our operating margin and generated a solid operating cash flow, which gives Ericsson a strong balance sheet to capture the opportunities that lie ahead.”

Vestberg said he intended to deliver strong earnings and value by driving transformation “across all industries and within our own company” as part of the shift towards the ‘networked society’

Business highlights during 2013, said Vestberg, included deals with Volvo Cars, Maersk Line and E.ON – they all use mobility, broadband and cloud to offer real-time services to their customers – as well as the IPR licensing agreement with Samsung.

Vestberg pointed to the acquisitions of Mediaroom and the intention to acquire Red Bee Media in order to fill portfolio gaps and build capabilities in OSS/BSS, TV and Media.

In separate news, Douglas Gilstrap, SVP and global head of strategy, has resigned from his role – effective 1 August 2014 – and will leave Ericsson’s executive leadership team. He joined Ericsson in 2009.

The process to find a replacement is now underway.