LG Electronics has reported revenues of 15.02 trillion won (US$ 13.9 billion) for the second quarter that ended June 30, 2018, which is up 3.2% compared to the same quarter last year. It posted profits of 771 bilion won (US$ 715.1 million), up 16.1% YoY, while net profit was down to 326.5 billion won (US$ 291.6 million) from 514.9 billion won, down 36.5% YoY. First-half 2018 sales and operating profits were at all-time record highs. Revenues increased 3.2% from the 2017 first half to 30.14 trillion won (US$ 28 billion) and operating income rose 18.5% to 1.88 trillion won (US$ 1.7 billion).
“Strong profitability from home appliances and air solutions and premium home entertainment products offset second-quarter operating losses from vehicle components and mobile communications,” said LG.
Mobile Communications sector reported a quarterly revenue of 2.07 trillion won (US$ 1.92 billion), down 4.1% QoQ and 19% YoY due to stagnating smartphone market and decreasing sales of mid to low-end smartphones in North and Latin America.
The Mobile sector posted a operating loss of 185.4 billion won (US$ 165.6 million), compared to loss of 139.7 billion won a year ago, which is down 24.6%. LG said that profitability decreased QoQ and YoY due to smartphone sales decline and increase in marketing expense to support new flagship product. With competition in the premium smartphone category expected to intensify and growth to remain stagnant in the second half, the company will seek to further improve its business structure and increase sales of the new premium LG G7 ThinQ and LG V35 ThinQ flagship smartphones in key markets around the world.
LG expects to expand sales with new competitive models and improve profitability by strengthening platform and modular activities in Q3 2018.