Ericsson (NASDAQ: ERIC) ousted CEO Hans Vestberg less than a week after the company posted a 26 percent year-over-year drop in net sales during the second quarter.

The Swedish telecom gear giant announced that Vestberg stepped down immediately but "remains at the company's disposal." CFO Jan Frykhammar will serve as interim CEO while Ericsson searches for a new leader.

"Hans Vestberg has led the company for seven years through significant industry and company transformation," board Chairman Leif Johansson said in a press release. "Hans has been instrumental in building strong relationships with key customers around the world and his leadership and energy have been an inspiration to employees and leaders across Ericsson. However, in the current environment and as the company accelerates its strategy execution, the board of directors has decided that the time is right for a new leader to drive the next phase in Ericsson's development."

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Ericsson continues to struggle as carriers in mature mobile markets have largely completed LTE buildouts and are preparing to invest in 5G over the next several years. Last week the company posted a net quarterly profit of $186 million, down from $240 million during the year-ago period. Sales fell to $6.3 billion, missing analysts' predictions of roughly $6.44 billion, Bloomberg reported.

Ericsson suffered through a rough first quarter as well, posting a 2 percent year-over-year decline in net sales due largely to a "continued weak macroeconomic environment."

Vestberg told FierceWireless last week that Ericsson would continue to slash expenses as part of a plan it announced in 2014. The company has eliminated roughly 30,000 as part of that plan in the last eight quarters, he said, and more cuts are in the works in the U.S. and around the world.

Reports surfaced last week that the company's two largest shareholders were pushing for Vestberg's ouster. The firms, Investor and Industrivarden, had reportedly held off sacking Vestberg because they had yet to find a suitable replacement.

Shares of Ericsson inched upward 1 percent in mid-day trading Monday.

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