On January 30th, LG released its fourth-quarter financial results for 2019 indicating a struggling mobile business despite restructuring efforts to see profitability.
LG posted a net loss of 849.8 billion won (~$717 million) in the quarter under review, a massive drop from a similar period in 2018 when the company reported 80.7 billion-won net loss.
Its deficit widened in Q4 2019, due to equity accounted for losses from LG Display, the company’s display-making affiliate.
Operating profits were up 34.5 percent year-on-year amounting to 101.8 billion won (about $87million). Compared to the previous quarter, however, this was 87 percent down.
LG’s mobile business wasn’t any better in the fourth quarter as it continued the downtrend since the start of the year. The unit saw a loss of 332 billion won further down from a loss of 318.5 billion won posted a year earlier.
Unit sales dropped, as well, by 21.2 percent compared to a similar period in 2018.
In the whole of 2019, LG’s mobile business loss amounted to 1.01 trillion won (~$858 million).
The company blamed “sluggish sales of mass-tier smartphones in overseas markets, increased marketing expenses and retail inventory adjustments led to operating loss in the mobile business,” for the losses incurred by its mobile business.
LG’s home appliance business grew strongly in the quarter, recording 4.62 trillion won in sales – up 7 percent YoY. For the quarter under review, the unit secured 122 billion won in operating profit. Annually, the home appliance business raked in 1.9 trillion won (~$1.7 Billion) in operating profits.
The company recorded 2.44 trillion won (~$2,07 billion) in operating profit for the whole of 2019, which slid 10 percent from the year prior. The company flagged the YoY loss for its increased investment in marketing and future technologies.