The smartphone market as a whole is continuing to see less demand and that’s leading to harder times for almost every OEM. That’s especially the case for OEMs who weren’t in a great place before these times, including LG, who continues to see its sales slowing in Q2 of 2019.
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Announced in a press release today, LG has confirmed its second-quarter results with stronger sales for the company as a whole, but a 15.4% drop in overall operating income. In the mobile division specifically, though, the news wasn’t so great.
LG saw an increase between Q1 and Q2 of 2019, seeing sales of 1.38 billion USD. That’s an increase of 6.8% between the two quarters, but a drop of 21.9% compared to the same period in 2018. LG puts the blame on the overall stagnant demand and aggressive pricing from Chinese brands.
The mobile division also saw an operating loss of 268.4 million USD as it invests in relocating its smartphone production to Vietnam. LG says that it expects things to improve in Q3 with the “growing demand” for 5G smartphones as well as the introduction of “competitive mass-tier smartphones,” meaning we’ll likely see some mid-range devices this fall.
The LG Mobile Communications Company recorded second-quarter 2019 sales of KRW 1.61 trillion (USD 1.38 billion), 21.3 percent lower than the same period last year due to stagnant demand in the smartphone market and continued aggressive pricing by Chinese brands. Sales increased 6.8 percent from the first quarter but the business united reported an operating loss of KRW 313 billion (USD 268.4 million) as a result of higher marketing investment to support the launch of new models and additional costs related to relocating smartphone production to Vietnam. The introduction of competitive mass-tier smartphones and growing demand for 5G products are expected to contribute to improved performance in the third quarter.
More on LG:
- LG Pay finally comes to the US, but only on the LG G8
- The LG G8 ThinQ is a phone full of good ideas ruined by all of the bad ones
- Report: LG suspending smartphone production in Korea where it manufactures flagship devices