LG Q2 Profit Climbs Despite Mobile Loss
LG Electronics has delivered strong quarter two results despite its mobile communications division posting an operating loss, with its home appliance & air solution and home entertainment divisions each reporting the highest quarterly operating profit in LG’s history.
LG posted second quarter operating income of 584.6 billion Korean won (around $690 million), up from 244.1 billion won year-on-year, with revenue of 14 trillion won up from 13.93 trillion won. LG’s net income of 268.5 billion won was up from 226.4 billion won year-on-year.
Posting an operating loss of 153.5 billion won, compared to a loss of 19.2 billion won year-on-year, LG’s mobile communications division recorded revenue of 3.33 trillion won, down from 3.54 trillion won.
LG stated that the operating loss reflected increased marketing expenditures and “somewhat slow” initial sales of the LG G5 smartphone.
“Overall smartphone shipments increased 3 per cent from the previous quarter, with a total of 13.9 million smartphones shipped in the second quarter,” LG stated.
“The launch of the new V series and expanding sales of mass-tier K and X series models are expected to improve the business unit’s performance next quarter.”
Year-on-year, LG’s smartphone shipments were down 1 per cent for the quarter.
The home appliance & air solution division contributed the largest share of LG’s second quarter operating profit at 433.7 billion won, up from 291.8 billion won year-on-year, with revenue of 4.7 trillion won up from 4.49 trillion won year-on-year.
The home entertainment division posted an operating profit of 356.7 billion won, up from a loss of 82.7 billion won year-on-year, on revenues of 4.16 trillion won, up from 3.93 trillion won.