Record smartphone shipments boost LG Electronics quarterly earnings

LG Electronics (LG) announced unaudited third quarter consolidated revenues of USD 14.54 billion, an increase of 7.4 percent year-over-year, and operating profit of USD 449.61 million, more than double the figure from the same period a year ago. LG’s earnings reflected strong performance from its mobile business which saw record smartphone sales in the third quarter with sales of 16.8 million units.

The LG Home Entertainment Company reported third-quarter revenues of USD 4.59 billion, a slight decline of 3 percent from the same period last year. Operating profit of USD 127.19 million increased 5 percent from the same quarter last year due to better product mix. Sales of LCD TVs increased year-over-year in regions such as North America, Europe, Asia and the Middle East. LG expects sales of 4K Ultra HD TVs and commercial digital signage products to grow, while market demand for monitors and AV products is expected to slow.

The LG Mobile Communications Company shipped a record-breaking 16.8 million smartphones in the third quarter, an increase of 39 percent year-on-year and 16 percent more units than the previous quarter. Sales of USD 4.14 billion and operating income of USD 163.16 million were the highest in the company’s history since the third quarter of 2009. Building on its momentum and two consecutive profitable quarters, LG expects to strengthen its positioning in the smartphone market with its G Series and L Series^III models despite the landscape becoming more competitive.

The LG Home Appliance Company reported revenues of USD 2.84 billion, a slight decrease from the same period the year before, despite improved sales in Korea, Europe and developing markets such as the Middle East and South East Asia. Greater competition in North America and unfavorable foreign currency exchange rates resulted in a lower third-quarter operating profit of USD 50.49 million. LG expects profitability to increase in the fourth quarter with an expanded home appliance product portfolio and improved cost structure.

The LG Air Conditioning & Energy Solution Company reported revenues of USD 902.14 million, a 5 percent decline from a year ago. An operating loss of USD 2.44 million was primarily due to weak demand in residential air conditioners in Korea related to weather conditions, which offset steady growth in the Middle East and Latin America. LG expects overseas sales to improve with more customized and higher energy efficient systems while it targets the growing construction and civilian industries in Korea with its commercial products.