Smartphones have LG back in black
By Cho Mu-hyun, Kim Yoo-chul
LG Electronics posted an operating profit of 220.5 billion won (about $195 million) in the third quarter, rebounding from last year’s deficit.
The turnaround was thanks to the company’s smartphone business finally showing a pulse and its television division reaming robust returns despite a global decline in the demand for consumer electronics products.
Revenue was measured at 12.38 trillion won, a 4 percent decline year-on-year mainly due to a drop in the sales of feature phones, while net income came in at 157.1 billion won.
LG has been paying heavily for being late to the lucrative market for smartphones, which appears to be shaping up as a duopoly between Apple and Samsung Electronics.
However, under the aggressive leadership of new mobile boss Park Jong-seok and positive reviews generated from its Optimus brand, LG finally appears to be seeing light at the end of the tunnel.
The company’s mobile division posted 21.45 billion won in operating profit and 2.45 trillion won in sales in the three months through September. This was a dramatic improvement from the third-quarter last year, when it posted an operating loss of 138 billion won.
``We sold 7 million smartphones in the third quarter, a new company record that exceeds the previous 6.2 million marked in the second quarter of last year. This is an increase of 23 percent from the previous quarter and 59 percent year-on-year,’’ said a LG spokesman.
``Smartphones such as the Optimus Long Term Evolution (LTE) 2, Optimus Vu and L were well received by consumers here and abroad.’’
LG recently launched two ambitious devices, the Optimus G and Optimus Vu 2, both LTE compatible and equipped with stronger-than-average computing and network power. Critics have been particularly impressed with the touch-screens of the devices, provided by LG affiliate, LG Display, for its picture quality and responsiveness.
“We will improve our portfolio and expand LTE devices by concentrating on the markets of developed countries,” said the spokesman.
The company’s home appliances division, which was also strong during the previous quarter, marked 2.87 trillion won in revenue and 129 billion ($113.86 million) in operating margins. Its front-load washing machines are popular in the United States.
Home entertainment systems saw sales of 5.49 trillion ($4.84 billion) and an operating profit of 88.6 billion won ($7.79 million).