LG Electronics posted record-breaking revenue and operating profit in the third quarter this year on the back of solid television sales but its mobile division continued to struggle in the red, officials said Wednesday.
The company’s consolidated revenue stood at 15.7 trillion won ($13.4 billion), its highest third-quarter figure, while operating profit was a 10-year high of 781 billion won, up 4.4 percent on-year.
The net profit, however, dropped 30.5 percent from a year earlier and marked the 18th consecutive quarterly loss, mostly due to its lackluster mobile business.
LG credited the solid TV sales and reduced loss on mobile phone business for its earnings. However, the mobile division’s revenue was still worse than the previous year.
The mobile communications division posted revenue of 1.5 trillion won and an operating loss of 161 billion won. The operating loss improved twofold compared to the second quarter, but was still roughly a 20 billion won-worse report compared to last year. The revenue fell both on-year and on-quarter.
LG said that despite the launch of dual-screen phones, which it proudly assesses has provided a completely new user experience for consumers, the global smartphone market has seen a decline in demand and a slower-than-expected turnover of the 5G network service. The on-quarter operating loss improvement is said to be because of the relocation of its manufacturing facility from Pyeongtaek, Gyeonggi Province, to Vietnam.
Still, LG’s combined revenue this year is 46.2 trillion won, an internal record and a 1.5 percent on-year rise.
The company’s home appliance & air solution division notched revenue of 5.3 trillion won with operating profit of 429 billion won. This is the first time the division’s third-quarter revenue has topped 5 trillion won. LG cited the growth globally propped up the sales. The operating profit increased thanks to the rise in sales, and a fall in raw materials price.
The home entertainment division marked a revenue of 3.8 trillion won and an operating profit of 318 billion won. The company cited an uptick in the sales in central and east Africa as well as Central America led to the increased revenue. The operating profit fell compared to the same period last year due to intensifying competition and unfavorable currency rate. LG underlined, however, that this was an increase compared to the second quarter.
The vehicle component solutions division had a revenue of 1.3 trillion won and a 60 billion won operating loss, and the business solutions division posted revenue of 698 billion won and 66 billion won operating profit.
Citing the low-season for home appliances in Korea during the winter, and the rising uncertainty in the global trade terrain, LG said it will focus on the premium segment in the fourth quarter to strengthen its business portfolio and efficiently allocate marketing budget.
The mobile phone market, on the other hand will enter the high season in the fourth quarter. The mobile division of LG said it will focus on the successful global launch of its latest improved dual-screen device.
The vehicle component division said it will closely watch the electric vehicle policies in the overseas market to efficiently utilize resources.
By Lim Jeong-yeo (email@example.com