LG Electronics returned its mobile phone business to breakeven in the first quarter, helped by solid sales momentum for its mid-tier devices, and said it expects the improvements to continue in Q2 with growing sales of its flagship G6 smartphone.
The mobile division posted a small operating loss of KRW 0.2 billion in the quarter, recovering from a loss of KRW 202 billion in the year-earlier period and KRW 463 billion in Q4. This was driven by annual sales growth of 1.7 percent and a sequential increase of 3.7 percent, to KRW 3.012 trillion.
The company reported smartphone shipments of 14.8 million units this quarter, up 10 percent from the first quarter of last year and 5 percent more than in Q4, in large part due to the Americas, it said. Quarterly growth was particularly strong in its home market Korea and Latin America, and also supported by the launch of the new K series.
LG said it's starting to see the fruits of last year’s reorganization and good momentum and expanding sales of the G6 are helping. However, price competition in the mass-tier segment and competition from other flagship models such as the new iPhone are expected to increase this year.
LG's group results were in line with its forecast, with total revenues up 9.7 percent year-on-year to KRW 14.66 trillion (USD 12.70 billion), and operating profit doubling to KRW 921.5 billion. In addition to the mobile improvement, growth was driven by the Home Appliance & Air Solutions division, which posted its highest quarterly operating income in eight years. Net profit jumped to KRW 836 billion from KRW 198 billion a year ago.
