LG Announces First-Quarter 2023 Financial Results
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By News Reporter
Have you ever wondered how many LG OLED TVs are shipped every year? 100 thousand units perhaps, maybe as much as a million? In the first half of 2023, LG recorded over 1.33 million shipments of its stunning OLED TVs, setting new benchmarks and records its competitors can only dream of.
According to market research firm
link hidden, please login to view, LG captured over 55 percent of the global OLED TV market in the first six months based on total shipments. As a renowned OLED TV leader now celebrating 10 years of innovation in this space, LG has once again defended its premium TV crown while further cementing LG OLED TV’s status as the pinnacle of premium TVs.
The “bigger the better” trend continues to prevail in the TV market, which is great news for LG. As more and more people desire larger TVs for their living spaces, models of 75 inches or larger accounted for a remarkable 11.4 percent share of total OLED TVs sold, while shipments’ yearly average growth rate topped 90 percent over the past five years. Staying on top of this growing trend, LG is resuming its dominance in the market with an outstanding 64.2 percent share in total shipments of OLED TVs over 75 inches.
LG is targeting this new demand for large and premium TVs in the second half of 2023 with the groundbreaking TV (model 97M3) it unveiled in July, which boasts the world’s first 4K 120Hz wireless solution that makes it easy for customers to achieve their dream interior.
Not one to be confined, LG unleashed a tidal wave of 10 million TV units (OLED and LCD) on the world, which has helped the company carve out a 16.2 percent share of revenue for itself in the global TV market.
Despite facing a downturn in the global TV market, LG persisted in strengthening its inventory management and securing higher profits while actively pursuing a strategic approach for its premium and ultra-large displays. And this commitment has paid off substantially, with its LG OLED TVs now accounting for around 30 percent of the company’s overall revenue generated from TV sets.
TV shipments totaled over 92 million units in the first half of 2023, matching last year’s first half performance. The OLED TV segment, which has been led by LG for a number of years, has already passed the 2 million shipments mark this year, which bodes well for the rest of 2023.
OLED TVs are continuing their takeover of the global TV market after capturing 9.3 percent of all revenue in the first half. Meanwhile, Omdia predicts that OLED TVs are set to shine even brighter, projecting at least a 43 percent revenue share among premium TVs priced above USD 1,500.
Find all the latest news on the home entertainment business and learn more about its world-leading innovations on the LG Newsroom.
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By News Reporter
Strategic Restructuring to Enhance Synergy and Drive Growth in Key Business Areas
SEOUL, Nov. 21, 2024 — LG Electronics (LG) today announced a series of organizational changes and executive appointments following the approval of its board of directors. This restructuring aims to accelerate the company’s mid- to long-term strategy, “Future Vision 2030,” by enhancing inter-organizational synergy and innovating its business portfolio.
The restructuring focuses on regrouping LG’s business operation units* to maximize the potential of existing businesses, strengthen platform-based service operations, accelerate B2B initiatives and secure new growth engines in promising sectors. These changes are designed to enhance efficiency through the strategic selection and concentration of capabilities, thereby creating greater synergy between businesses and bolstering future competitiveness.
To spearhead this transformation, LG has appointed skilled individuals with exceptional expertise, emphasizing the enhancement of the company’s long-term competitiveness through the development of high-performing organizations.
Key Changes in Business Structure
A new Company will be established to bolster the growth of the heating, ventilation and air conditioning (HVAC) business, a crucial component of LG’s B2B acceleration strategy. The Overseas Sales & Marketing Company will now function as the overseas B2B control tower. Additionally, display-based operations – including TVs, monitors and signage – will be integrated to foster synergies and expand platform-based service businesses. New growth engines will be strategically relocated to Companies with greater business relevance, ensuring more stable support and creating synergies across business areas.
All four Companies will now incorporate “Solution” in their names, reflecting LG’s evolution into a Smart Life Solution provider that connects and enhances customer experiences across various environments, including homes, commercial spaces, mobility and virtual platforms.
Restructuring of Companies
LG has restructured its four Companies into the Home Appliance Solution (HS) Company, the Media Entertainment Solution (MS) Company, the Vehicle Solution (VS) Company and the Eco Solution (ES) Company. This reorganization redefines their roles and identities within LG.
The H&A Company will be renamed HS Company to align with its vision of “Zero Labor Home, Makes Quality Time.” To support this vision, LG will move the Platform Business Center – responsible for the planning, development and operation of LG ThinQ – directly under HS Company. This strategic realignment aims to establish HS Company as a leader in AI solutions across diverse spaces, including homes, commercial areas and vehicles, effectively addressing customer needs outside traditional home settings. Furthermore, HS Company will incorporate the Robot Business Division from the BS Company to integrate core robot technologies into its home robot solutions. Lyu Jae-cheol will continue to lead HS Company.
The HE Company will change its name to MS Company to align with its goal of becoming a media and entertainment platform powerhouse. It will integrate the Information Display business and Information Technology business from the BS Company with its TV business to create synergies in hardware and platform operations. Park Hyoung-sei will continue to lead the MS Company, driving its transformation into a media and entertainment platform.
The MS Company will accelerate the expansion of platform-based service business areas by broadening the application of webOS, which was primarily used in smart TVs, to monitors, signage and in-vehicle infotainment systems. webOS will evolve into an integrated content and services platform for both indoor and outdoor use, enhancing competitiveness through synergy and improved business structure.
The VS Company will clarify its role by changing its name from Vehicle component Solutions Company to Vehicle Solution Company, emphasizing its commitment to providing innovative solutions across the entire automotive ecosystem. Eun Seok-hyun will continue to lead the company.
The ES Company has been newly established. The HVAC business, previously part of the H&A Company and a significant contributor to LG’s B2B growth, will now operate as a standalone entity under the ES Company. Lee Jae-sung, the current head of the Air Solution Business Division, will lead the ES Company, ensuring continuity in the HVAC business and maintaining its strategic direction.
Given the project-based nature of the HVAC business and the specific characteristics of the market and its customers, LG has determined that operating it as an independent Company will maximize future competitiveness and growth potential. With the establishment of the ES Company, LG aims to position itself as a global leader in comprehensive air solutions.
Additionally, the ES Company will assume responsibility for the electric vehicle charging business from the BS Company and play a pivotal role in driving B2B growth within the clean tech sector, one of LG’s key future growth engines.
Meanwhile, to enhance the competitiveness of overseas B2B operations, LG will establish the B2B Business Capability Enhancement Division under the Overseas Sales & Marketing Company.
The Chief Strategy Office (CSO), acting as LG’s future strategy control tower, will also oversee AI acceleration and respond to global AI developments. The Chief Digital Office, previously responsible for digital transformation, will be reorganized into the DX Center and transferred directly under the CSO. The DX Center will focus on driving business performance through generative AI technologies and will be led by Cho Jung-bum.
The executive appointments emphasize the selection of diverse talents with proven expertise in sales, services and R&D. Jung Pil-won, currently leading the TV Overseas Sales & Marketing Group, has been appointed as the MEA Region Representative, recognizing his extensive experience in overseas sales management and his deep understanding of the Middle Eastern and African markets. Additionally, Kim Jung-ho, Kim Yoo-seon and Choi Jung-won, who head the subsidiaries in Saudi Arabia, Poland and Malaysia respectively, have been promoted to executive positions in acknowledgment of their significant contributions to business growth.
All appointments are effective December 1, with promotions taking effect on January 1.
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* LG’s major business operation units are called “Companies.”
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By News Reporter
Company Achieves Highest Third-Quarter Revenue and Sustains
Year-Over-Year Growth for Four Consecutive Quarters
SEOUL, Oct. 24, 2024 — LG Electronics Inc. (LG) today announced its third-quarter 2024 consolidated revenue of KRW 22.18 trillion and an operating profit of KRW 751.9 billion. This revenue marks the highest ever for a third quarter, while the operating profit ranks as the fourth highest in the company’s history.
Several external factors impacted the third quarter, including a prolonged delay in market demand recovery and ongoing geopolitical conflicts worldwide. These challenges led to a rise in global shipping expenses, contributing to increased costs.
Despite these obstacles, LG has achieved year-over-year revenue growth for four consecutive quarters by upgrading its business portfolio. This includes transforming business methods and models and expanding B2B operations. These efforts have allowed LG to partially offset the unavoidable cost increases, enabling the company to maintain a robust operating profit, signifying the retention of strong fundamental competitiveness.
Looking ahead, LG plans to further accelerate its business transformation by expanding home appliance subscriptions, direct-to-consumer (D2C) sales and volume zone product sales. In addition, the company aims to drive steady growth in the B2B sector while also expanding platform-based content and service businesses.
The LG Home Appliance & Air Solution Company generated third-quarter revenue of KRW 8.34 trillion and an operating profit of KRW 527.2 billion. Compared to the same period last year, revenue increased by 11.7 percent and operating profit by 5.5 percent. Despite challenging external conditions, LG’s home appliance business outperformed its peers, reaffirming its top-tier competitiveness. Even with the delayed recovery in global appliance demand, the rapid growth of the subscription business model and B2B HVAC business drove revenue expansion. Although the surge in logistics costs in the second half of the year significantly impacted operating profit, the company achieved results exceeding the same period last year, thanks to revenue growth and exceptional manufacturing competitiveness.
In the fourth quarter, market conditions are expected to gradually improve, as indicated by improvements in leading economic indicators in major countries and interest rate cuts. LG plans to diversify its home appliance lineup and pricing strategy to meet the growing demand in emerging markets, while also expanding new businesses such as subscriptions and D2C sales to maintain revenue growth. The company will continue to focus on efficient operations, considering the seasonal increase in marketing expenses, to secure profitability.
The LG Home Entertainment Company posted third-quarter revenue of KRW 3.75 trillion and an operating profit of KRW 49.4 billion. Revenue increased by 5.2 percent compared to the same period last year, driven by increased shipments in Europe – a key market for OLED TVs. Although the cost burden increased significantly due to a sharp rise in LCD panel prices, the continued growth of the webOS-based content and services business minimized the impact on overall profits.
In the fourth quarter, the TV market is expected to see slight growth, primarily in entry-level products, compared to the same period last year. LG plans to respond flexibly to changes in TV market demand while accelerating growth by expanding its webOS partnerships to increase its user base.
The LG Vehicle component Solutions Company reported third-quarter revenue of KRW 2.61 trillion and an operating profit of KRW 1.1 billion. Revenue increased compared to the same period last year but slightly decreased from the previous quarter due to a slowdown in electric vehicle (EV) demand. Operating profit also declined, impacted by increased R&D expenses for securing software-defined vehicle (SDV) technology and preemptive investments for mass production of order volumes.
The market in the fourth quarter is expected to maintain a growth trend compared to the same period last year and the previous quarter. However, growth is anticipated to slow due to stagnant EV demand. LG plans to focus on sales growth based on its secured order backlog and on strengthening the market position of its main products, including telematics, AVN and motors. Additionally, the company will continue efforts to improve efficiency across its operations and pursue profitability.
The LG Business Solutions Company reported third-quarter revenue of KRW 1.40 trillion and an operating loss of KRW 76.9 billion. Revenue grew year-over-year due to increased sales of strategic products such as gaming monitors and LED signage, as well as securing large-scale B2B orders for PC products. However, the operating loss expanded due to rising LCD panel prices, increased logistics costs, intensified competition and higher investments in nurturing new businesses within the Company.
In the fourth quarter, demand for strategic product lines including gaming monitors and LED signage is expected to grow by double digits compared to the same period last year. Additionally, the rising interest in AI PCs is anticipated to boost demand for premium laptops. Consequently, the Company plans to expand sales of strategic products and focus on improving profitability through efficient operations.
Meanwhile, following a board resolution last month, LG decided to discontinue its battery pack business. As a result, starting from the third-quarter earnings report, related revenue and operating profit will be treated as discontinued operations in the financial statements. This will also lead to adjustments in past revenue and operating profit figures.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on October 24, 2024, at 16:30 Korea Standard Time (07:00 GMT/UTC). Conference call participants should pre-register online to receive a private PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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By News Reporter
Winners Showcase Family-Friendly Gaming Innovations and
Address the Growing Interest in AI Technologies at LG webOS Summit
SEOUL, Oct. 1, 2024 — LG Electronics (LG) announced the winners of its webOS TV platform hackathon, which took place at the LG webOS Summit last week. The event was geared toward AI-based solutions and gaming services, and sought ideas to enhance the gaming category on the Smart TV.
Developers from around the world applied for the opportunity to present their ideas for apps or services to be used on webOS-based LG Smart TVs in millions of homes, with the goal of diversifying and improving the gaming experience on the LG TVs powered by webOS.
Over three hundred entries were submitted from more than 50 countries. Finalists were invited to present their ideas onstage to a panel of LG executives and over 300 market-leading companies. The top three winners received a meaningful opportunity to engage with the LG team to develop their ideas and resources for business implementation on webOS. They will continue to work with the LG team to prepare the family-friendly gaming solutions for LG TVs by June 2025. Cash prizes were awarded to the top three winners of the hackathon, with the Grand Prize of USD 100,000 for first place, USD 80,000 for second place and USD 50,000 for third place.
Grand Prize Winner: The Quest of Sunflower by Couchplay
An epic adventure game based on an AI-generated story, featuring stunning graphics, immersive audio and responsive game play suitable for the whole family.
Second place: Signs of Magic by Lukas Klingsbo
Set in a magical world, this game follows the wizard Elowen as she battles invading creatures known as Astromentals. It integrates LG Magic Remote sensors to create an immersive experience that brings the action to life.
Third place: Thormdeil: Into the Unknown by TV Games
The first single-player RPG developed exclusively for a Smart TV platform, featuring seasonally AI-generated content. Players navigate dark dungeons, face survival challenges and uncover hidden truths.
“The amount of participation and entries we received this year is proof of the growing interest in the AI and gaming categories,” said Chris Jo, senior vice president of platform business at LG Home Entertainment Company. “We’re no longer simply watching television. The developer ecosystem’s role in improving the lives of millions of consumers in their homes is exponential, and LG plans to hold this event annually to foster webOS app developer ecosystem.”
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By News Reporter
Company Sets New Records for Second Quarter Revenue and Operating Profit
Through Balanced Qualitative Growth in Core and Future Businesses
SEOUL, July 25, 2024 — LG Electronics Inc. (LG) today announced second-quarter 2024 consolidated revenue of KRW 21.69 trillion and operating profit of KRW 1.20 trillion, reflecting an 8.5 percent year-over-year increase in revenue and a 61.2 percent surge in operating profit. These figures mark new records for the highest second-quarter revenue and operating profit in the company’s history.
Key drivers of this performance include the home appliance and vehicle component sectors, both achieving their highest quarterly revenues to date. Sales from LG’s Home Appliance & Air Solution Company and Vehicle component Solutions Company combined reached KRW 11.53 trillion, up 8.2 percent from the previous year. Both Companies also reported record-high second-quarter operating profits, totaling KRW 776.1 billion, which represents a 45 percent year-over-year increase.
These results highlight LG’s balanced growth across its core and future businesses. This growth demonstrates not only external expansion but also solid profitability, contributing to qualitative improvements in overall performance.
LG continues to transform its business portfolio towards a future-oriented approach, maximizing the potential of existing businesses while securing new growth opportunities. The company is also focused on rapidly advancing high-growth potential new businesses.
The fast growth in LG’s B2B sector significantly contributes to establishing a future-oriented business structure. Despite a temporary slowdown in EV demand, the vehicle component business continues to grow, supported by a diversified client base of electric and internal combustion vehicles and a strong order backlog. Additionally, LG’s heating, ventilation and air-conditioning (HVAC) business, which includes high-efficiency chillers, is exploring growth opportunities within the AI infrastructure sector.
In the B2C domain, LG is accelerating the integration of new business models that combine traditional hardware sales with intangible, non-hardware offerings such as content, services and subscriptions. The webOS content and services business is expanding beyond TVs into IT and infotainment, with projected revenues set to surpass KRW 1 trillion this year.
Additionally, the subscription business, which merges products with services, is gaining remarkable momentum. After achieving success in Korea, LG is now expanding this subscription model internationally. Last year, subscription revenue exceeded KRW 1 trillion, with growth accelerating this year. In June, 36.2 percent of major home appliances sold at LG Brand Shops in Korea were subscription-based. This model, particularly popular among young Korean customers, is now being introduced to global markets. For example, LG has launched LG Rent-Up in Malaysia, offering subscriptions for nine products, including washing machines, dryers and refrigerators.
LG is also expediting the advancement of new businesses. The smart factory business, which combines the company’s manufacturing expertise with AI, is expected to secure orders worth KRW 300 billion this year, expanding its customer base in industries such as semiconductors and biotechnology. Furthermore, LG’s partnership with ChargePoint, North America’s leading EV charging company, is set to boost the EV charging business by combining ChargePoint’s chargers with LG’s commercial display advertising solutions, ‘LG DOOH Ads,’ creating new market opportunities.
The LG Home Appliance & Air Solution Company generated second-quarter revenue of KRW 8.84 trillion and an operating profit of KRW 694.4 billion. Compared to the same period last year, revenue increased by 11 percent and operating profit by 16 percent, marking the highest revenue for a single quarter and the strongest second-quarter operating profit to date.
In the second quarter, LG’s volume zone strategy – designed to address polarized market demand – proved effective by diversifying its product lineup and pricing to meet growing needs in emerging markets such as Latin America, the Middle East and Africa. Contributions from new business areas, including subscriptions and Online Brand Shop sales, bolstered the strong performance. Looking ahead to the third quarter, LG intends to remain agile in adapting to market shifts and to continue expanding its B2B sectors, particularly HVAC and built-in appliances. The recent acquisition of smart home platform company Athom is expected to create synergies within the home appliance sector. Additionally, LG will leverage its top-tier global manufacturing capabilities to secure robust profitability.
The LG Vehicle component Solutions Company achieved second-quarter revenue of KRW 2.69 trillion and an operating profit of KRW 81.7 billion. Revenue increased by 1 percent year-over-year, and the operating profit turned positive. This quarter’s revenue was the highest for any quarter, and the operating profit was the strongest for a second quarter.
Despite a temporary slowdown in the EV market during this period, LG saw growth by effectively addressing increased demand for premium in-vehicle infotainment products and plans to continue expanding its vehicle components business. This strategy includes increasing sales of premium new products as well as safety and convenience solutions, such as Advanced Driver Assistance Systems, in line with existing order programs.
The LG Home Entertainment Company posted second-quarter revenue of KRW 3.62 trillion and an operating profit of KRW 97 billion. Revenue increased by 15.3 percent compared to the same period last year, driven by a recovery in demand in Europe, a key market for premium OLED TVs. Growth also continued in the webOS content and service business. However, operating profit declined due to increased costs, including rising LCD panel prices.
Overall TV market demand is expected to show modest growth in the third quarter compared to last year, with premium OLED TVs anticipated to outperform the broader market. LG will aim to maintain operational efficiency by minimizing cost burdens, such as rising LCD panel prices, through increased sales of OLED TVs.
The LG Business Solutions Company reported second-quarter revenue of KRW 1.46 trillion and an operating loss of KRW 5.9 billion. Revenue increased by 9.9 percent year-over-year, driven by expanded sales of strategic products such as LED signage, electronic whiteboards and gaming monitors. However, profitability was impacted by cost increases, including LCD panel prices, and ongoing investments in growth areas like EV charging and robotics.
In the third quarter, market growth for premium products such as commercial displays and gaming monitors is expected to continue. The Company will focus on expanding sales of strategic products and improving profitability through efficient resource management.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on July 25, 2024, at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants should pre-register online to receive a private PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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