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Thursday, October 24, 2013

Quarterly figures show LG’s phone business dropping back into the red

LG Electronics has reported quarterly results that show the mobile communications part of its business moving from profit into loss for the first time since the same quarter last year.

Overall profit for the company was up year-on-year to 218 billion South Korean Won (£127 million), although down from the previous quarter. Sales were also up from Q3 2012 but down from Q2 2013, reaching almost 14 trillion Won (£8 billion). Net profit was down year-on-year to 109 billion Won.

The mobile communications division sold 12 million smartphones, pushing sales revenue up 24% year-on-year to 3 trillion Won (although still down 2% from the previous quarter). However, it lost almost 80 billion Won during the quarter.

LG said this decline in mobile profitability was due to increased marketing expenses for the flagship G2 smartphone as well as competition causing average selling prices to decrease.

[LG earnings release (pdf)]

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Author: The Fonecast
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