LG Announces Third-Quarter 2022 Financial Results
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By News Reporter
Company Pushes Boundaries With Innovative Business Models
While Balancing Core Operations and Future Growth to Create New Opportunities
SEOUL, April 25, 2024 — LG Electronics Inc. (LG) announced first-quarter 2024 consolidated revenue of KRW 21.09 trillion and operating profit of KRW 1.33 trillion. The company’s home appliance sector demonstrated global leadership, achieving record-breaking revenue and double-digit operating profit margins. The EV components sector, a key driver of future growth, continued its steady expansion. Both the TV and business solutions sectors experienced year-on-year sales growth and returned profits compared to the previous quarter.
Despite navigating challenging macroeconomic conditions such as high commodity prices, volatile exchange rates, rising interest rates and delayed demand recovery, LG achieved its highest-ever total revenue for a first quarter. This milestone underscores the effectiveness of implementing sustainable business models like subscription services and leveraging growth opportunities in the promising B2B sector. LG’s emphasis on differentiating features such as AI, energy efficiency and customer-centric design has strengthened its competitiveness in the premium market. Furthermore, the strategic approach of offering diverse product lineups and flexible pricing structures enabled the company to successfully navigate polarized demand trends.
Operating profit surpassed KRW 1 trillion for the fifth consecutive year, showcasing LG’s strong performance in the face of intensifying market competition. The company’s focus on content/service businesses and direct-to-consumer sales via the Online Brand Shop (OBS) has fueled qualitative growth. Efforts to stabilize raw material and logistics costs, coupled with production location flexibility, have further bolstered profitability.
The LG Home Appliance & Air Solution Company generated first-quarter revenue of KRW 8.6 trillion and an operating profit of KRW 940.3 billion. This represents a notable 7.2 percent increase in revenue compared to the same period last year, setting a new record for first-quarter performance. Operating profits reached the second-highest level in the company’s history, with an operating profit margin of 10.9 percent, underscoring the company’s exceptional global competitiveness.
Driven by its core technologies, particularly in motors and compressors, LG’s home appliance business continues to innovate within a mature market landscape. With a commitment to industry leadership, LG is pioneering transformative initiatives such as product subscription services and advancing the concept of ‘Affectionate Intelligence’ appliances. These innovations are tailored to empathize with and address customer needs effectively. Moreover, LG is strategically expanding its B2B ventures, including HVAC and built-in solutions, to capitalize on emerging growth opportunities.
The LG Vehicle component Solutions Company reported first-quarter revenue of KRW 2.66 trillion and an operating profit of KRW 52 billion, reflecting an 11.5 percent year-on-year revenue increase. The ongoing conversion of backlog orders into revenue is progressing steadily. Despite ongoing investments in overseas production sites to fulfill new orders and meet OEM demands, the company has maintained stable profitability, benefiting from economies of scale resulting from revenue expansion.
While there are expectations of a slight slowdown in the recent growth of EV demand, the demand for high-value-added EV components continues to rise steadily. LG is proactively addressing these market dynamics by developing a balanced portfolio, spanning from in-vehicle infotainment to powertrains and headlamps. The company aims to ensure sustained revenue growth and a stable profit base by actively adapting to these market shifts.
The LG Home Entertainment Company reported first-quarter revenue of KRW 3.49 trillion and an operating profit of KRW 132.2 billion. This represents a 4.2 percent increase in revenue compared to the same period last year, driven by a resurgence in TV demand in Europe and the successful launch of new 2024 models. The positive operating profit was fueled by the robust performance of the webOS content/service business, alongside traditional product sales. Despite challenges such as rising LCD panel prices, the company effectively managed profitability.
Looking ahead, a gradual recovery in the TV market demand is anticipated in the second half of the year. LG’s strategy focuses on leveraging its globally leading OLED TV and premium LCD QNED TV offerings while continuously enhancing the profitability of the webOS platform business, which is poised for rapid growth.
The LG Business Solutions Company reported first-quarter revenue of KRW 1.57 trillion, marking a 6.5 percent increase year-over-year, and an operating profit of KRW 12.8 billion. The launch of new LG gram laptops, featuring on-device AI and timed for graduation and enrollment seasons, garnered positive market feedback. In addition, sales of commercial display products, including electronic whiteboards and LED signage, experienced growth. While operating profit returned to positive territory from the previous quarter, there was a slight decrease compared to the same period last year, attributed to factors such as rising component prices and intensified competition.
This year, the overall IT market is expected to maintain similar demand levels to the previous year, with a slight growth anticipated in the commercial display segment. There is an expected increase in demand for high-spec IT products like gaming monitors and LED signage. LG aims to lead the market with strategic IT products tailored to customer needs, integrating gaming-specific features and OLED displays, alongside premium LED products. Efforts to proactively develop promising new businesses such as robotics and EV charging continue to drive future growth prospects.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on April 25, 2024, at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants should pre-register online to receive a private PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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By News Reporter
Highest Annual Revenue in History With Home Appliance and
Vehicle Components Showing Growth for Eight Consecutive Years
SEOUL, Jan. 25, 2024 — LG Electronics Inc. (LG) announced its financial results for the year 2023, disclosing a consolidated revenue of KRW 84.2 trillion and an operating profit of KRW 3.55 trillion. This marks the third consecutive year of achieving record-breaking annual revenue. The operating profit is also solid, approaching levels seen during the prior period of pent-up demand.
Despite challenging external factors such as an economic slowdown and reduced demand, LG’s core business of home appliances and the burgeoning vehicle components business have demonstrated remarkable resilience, maintaining continuous growth for eight consecutive years. The combined revenue of these businesses exceeded KRW 40 trillion last year, a substantial increase from KRW 18 trillion in 2015. Over the same period, the proportion of these two businesses in the total revenue has risen from 32.5 percent to 47.8 percent.
The performance is attributable to LG’s strategic efforts to enhance its business portfolio. The company successfully expanded its B2B business by identifying market turning points early on and integrated new business models, including subscription services, into existing frameworks. Furthermore, LG’s innovative content and service business model, leveraging its extensive user base of hundreds of millions of products globally, has also contributed to securing robust profitability.
Looking ahead, LG is committed to a continual transformation from a mature business-oriented structure to a future growth-oriented one. In this year, the company will concentrate its capabilities on breaking through limits to maximize its business potential. Guided by the newly established Overseas Sales & Marketing Company, LG will strive for additional growth and expanded product coverage, particularly in emerging markets where there are greater growth opportunities.
The LG Home Appliance & Air Solution Company achieved an annual revenue of KRW 30.14 trillion, marking eight consecutive years of growth and ushering in the era of KRW 30 trillion. Introducing new business models including subscription services and expanding the B2B share in areas such as HVAC, components and built-in solutions contributed to this growth. The operating profit recorded an increase of over 76 percent compared to the previous year, reaching KRW 2.08 trillion.
In the coming year, the Company will accelerate a shift in its business model towards future readiness, including Direct-to-Consumer initiatives. It aims to expand the deployment of home appliance operating systems and extend subscription services to international markets. Additionally, there will be a swift progression in building smart home solutions that reflect the value of “Zero Labor Home.” In terms of products, the Company will seek to maintain its strategic approach of solidifying the premium leadership of key products, such as washing machines and refrigerators, while swiftly expanding region-specific lineups. To sustain continuous growth in the B2B sector, especially in areas like HVAC, the Company plans to strengthen its capabilities by establishing a complete, local business operation that encompasses product development, production and sales, with a focus on the evident electrification trends in regions such as North America and Europe.
The LG Vehicle component Solutions Company achieved an annual revenue of KRW 10.1 trillion and operating profit of KRW 133 billion. In its 10th year since establishment, the Company not only surpassed the KRW 10 trillion revenue mark but also demonstrated eight consecutive years of growth since it began disclosing performance results in 2015. The share of total consolidated revenue has increased to 12 percent. This year, the Company aims to drive both external growth, leveraging a substantial order backlog, and qualitative growth in its operations. In in-vehicle infotainment, the Company is dedicating efforts to secure capabilities in the area of software-defined vehicles in response to the needs of OEMs. Drawing upon its differentiated technology accumulated in the home appliance and IT sectors, the Company will seek to further enhance the in-vehicle customer experience. In the e-Powertrain area, focus will be on strengthening product capabilities and early stabilization of overseas production bases to enhance responsiveness to customer demands. Additionally, in headlamps, there are plans to expand premium product orders while simultaneously improving operational efficiency.
The LG Home Entertainment Company recorded an annual revenue of KRW 14.2 trillion and operating profit of KRW 362 billion. The webOS platform-based content and services business solidified its position as a new source of revenue, showing a significant increase in operating profit compared to the previous year. The revenue slightly decreased amid a relatively slow recovery in demand for premium products like OLED. In anticipation of a progressive recovery in TV demand this year, the Company will seek to strengthen both the top-tier OLED lineup and the QNED lineup, following a dual-track strategy to lead the premium market. Simultaneously, the Company is accelerating its transformation into a media and entertainment powerhouse. In the current year, the webOS platform business is slated for nurturing as a significant revenue-generating venture in the scale of trillions.
The LG Business Solutions Company recorded an annual revenue of KRW 5.4 trillion and operating loss of KRW 42 billion. The revenue saw a slight decrease compared to the previous year due to delays in IT demand recovery and reduced investments from key enterprises. Increased investments in future growth areas such as robotics and electric vehicle charging had an impact on profitability. In this year, the Company is positioning itself with a competitive lineup of IT products, including gaming monitors and the LG gram Pro, and will actively seek to find business opportunities targeting distinct verticals such as government agencies and schools. As a leader in LG’s B2B business, it aims to accelerate the shift from supplying single products to integrating and providing adjacent solutions. With a significant proportion of new businesses within the organization, investments will be prioritized for future preparations rather than short-term management performance.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on January 25, 2024, at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants are instructed to pre-register online to receive a private PIN. To participate in the conference call, dial +82 31 810 3130, enter passcode 6418# and then the PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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By ebr9999
That Orange field (from SM/etzadjust) I can click for modification on my C1, but I cannot on my C2.
Any hint about how I can achieve that?
Background: my goal is enabling PVR/TS, enabled on my 65C1, but disabled on my 42C2.
I know it is risky, but copying the value of the same model with those features should achieve that, as discussed here:
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By News Reporter
Company Aims for Further Growth and Changes
to Enhance Customer Value in Rapidly Changing Global Market
SEOUL, Nov. 24, 2023 — LG Electronics (LG) today announced organizational changes to take another leap forward towards achieving the Future Vision 2030 announced in July. The changes are being implemented to strengthen organizational capabilities and business competitiveness to realize the vision of transforming into a Smart Life Solution Company that connects and expands various spaces and experiences of customers beyond home appliances.
A key piece of the forward-thinking strategy is the newly-established Overseas Sales and Marketing Company, which will report directly to LG CEO William Cho. The company will be led by Thomas Yoon, who previously served as the president and CEO of LG Electronics North America.
The Overseas Sales and Marketing Company will play a crucial role in accelerating change and growth as well as enhancing LG’s global brand power by discovering and developing opportunities to create customer value. The new organization will manage overseas sales subsidiaries in North America, Europe, the Middle East and Africa, Latin America and Asia; Global Marketing Group; and the Direct-to-Consumer (D2C) Sales Business Group.
The company will not only seek to strengthen executive capabilities in the overseas operations of strategically critical businesses including B2B operations, but also provide necessary support to bolster qualitative growth of all other business units by aiding the development of overseas sales expertise as well as accelerating the advancement of platform-based businesses and innovative D2C business models. The D2C Business Sales Group will take on the role of expanding customer contact points by strengthening Online Brand Shop (OBS) activities and customer data-based digital marketing capabilities.
While maintaining its agile and responsive decision-making system across all four business units, LG will aim to spur further development of original technologies in each business unit and support the company’s business transformation.
The Home Appliance & Air Solution (H&A) Company will establish an engineering sales division under the Air Solution Business to enhance the engineering capabilities to maximize business synergy in heating, ventilation and air conditioning (HVAC), its core B2B business area. In addition, the Home Beauty Business will be transferred from the Home Entertainment Company to the H&A Company to create synergy with existing strong product lineups in ‘Home’ spaces.
The Home Entertainment (HE) Company is set to further accelerate its transition to become a media and entertainment powerhouse. To strengthen the smart TV operating system webOS, the webOS SW Development Group will be established for direct reporting to Park Hyoung-sei, president of the HE Company. Also, the eXtended Reality (XR) Business Division will be established directly under the headquarters.
Leading the company since 2019, president Park has been promoted in recognition of his contribution to upgrading the company’s business portfolio, improving profitability of premium product lineups and growing the webOS platform while solidifying the company’s position in the global OLED TV market.
The Vehicle component Solutions (VS) Company will set up the Global Customer Strategy Division directly under its headquarters to establish an integrated strategy for order and sales management and strengthen marketing functions to accelerate the growth of the business.
The Business Solutions (BS) Company will expand sales and business operations in major regions such as North America, Europe, the Middle East and Africa, Latin America and Asia. The current B2B India Business Department will be upgraded into the B2B India Business Division to maintain continuous growth in the country.
All appointments are effective Dec. 1 with promotions going into effect on the first day of the new year.
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By News Reporter
High Performance, Strong Profitability Reflect Progress in Advancing Busines
Portfolio, Accelerating B2B Business and Procuring New Growth Engines
SEOUL, Oct. 27, 2023 — LG Electronics Inc. (LG) today announced third-quarter 2023 consolidated revenue of KRW 20.7 trillion and operating profit of KRW 996.7 billion, both the second highest third-quarter figures in the company’s history. The noteworthy performance was driven by both the company’s core home appliance business and vehicle solutions, one of its future growth engines. Home appliances more than doubled its operating profit year-over-year while vehicle solutions recorded an all-time high operating profit.
The strong performance reflects the company’s smooth progress in the execution of its future vision for 2030, leading to solid revenue and profits despite a prolonged economic slowdown. The fundamentals of LG’s 2030 vision, announced last July, is to focus on B2B expansion, non-hardware business model innovation as well as the development and acquisition of new growth engines with the aim to go beyond a home appliance company to truly become a Smart Life Solutions company capable of connecting and expanding diverse spaces and experiences.
The revenue growth was greatly bolstered by expansion in B2B, including automotive parts and HVAC systems – a key factor behind the second highest third-quarter figure in the company’s history. Revenue in B2B grew significantly to account for approximately 35 percent of overall revenue this year.
B2B segments are less influenced by economic conditions compared to B2C, and stable revenue and profits can be expected once the business is properly set up. Another merit is the lock-in effect that can help promote the development of a strong long-term relationship with clients and customers. LG plans to develop additional growth opportunities in the area by going beyond merely supplying B2B products to expand into providing high added-value business solutions in connection to the supplied products. The goal will be to boost B2B revenue to over KRW 40 trillion by 2030.
Third-quarter operating profit increased by more than 30 percent both year-over-year and quarter-over-quarter. A key contributor to the high profitability was the company’s business model innovation – combining non-hardware solutions such as content and subscription services with traditional hardware products such as home appliances and TVs. In the past, a one-off revenue was recorded when a product was sold. This has now transformed into generating recurring revenue from the use of solutions on platforms installed in the millions of products used by consumers of LG devices.
In developing and acquiring new growth engines, LG aims to focus on investing in promising businesses that not only show high potential but can also create synergy with existing businesses. Investment into electric vehicle charging is a prime illustration of such strategy. The company has plans for global expansion beginning next year in collaboration with diverse partners.
The seamless operation and solid progress of the company’s 2030 vision’s three pillars – leading growth of company (B2B), generating profit (non-hardware) and boosting enterprise value (new growth engines) – is a strong demonstration of LG’s advancement toward achieving Triple 7 (average growth rate and operating profit of 7 percent or more and enterprise value to EBITDA ratio of 7 or more).
LG will continue to focus on accelerating its business portfolio transformation efforts into the fourth quarter, seeking to maintain high-growth in B2B with vehicle component solutions taking the lead, while at the same time growing sales of key product lineups as the end-of-year peak season approaches. Simultaneously, the company plans to optimize efficiencies through enhanced demand forecasting to support stable profitability going forward.
The LG Home Appliance & Air Solution Company generated third-quarter revenue of KRW 7.46 trillion and an operating profit of KRW 504.5 billion. The operating profit more than doubled year-over-year, attributable to strong competitiveness in overall business operations including manufacturing, procurement and logistics. Revenue maintained strong versus last year’s third quarter, aided by strategic repositioning of product lineups in response to softened demand as well as expansion of B2B lineups including HVAC, parts and built-in appliances. LG plans to leverage the electrification and decarbonization trend in HVAC systems to accelerate its B2B growth momentum. For example, in the United States, the company recently committed to a series of actions supporting California’s goal to install six million electric heat pumps by 2030. LG is also actively expanding its HVAC portfolio with new Dedicated Outdoor Air Systems. In the fourth quarter, the company will seek to spearhead a paradigm shift in home appliances with the LG ThinQ UP 2.0 expanding business into services and subscriptions. Four upgraded features for the ThinQ UP have already been released in North America, accelerating the speed of customer experience innovation.
The LG Vehicle component Solutions Company’s third-quarter revenue was KRW 2.5 trillion and operating profit KRW 134.9 billion – the highest among all third-quarter revenue and operating profit. The company is accelerating its pace of growth based on stable management of its supply chain and an order backlog that is expected to reach KRW 100 trillion by the end of the year. The business unit is expected to exceed KRW 10 trillion in annual revenue for the first time this year, setting the stage to become a key driving force in LG’s overall growth. Growth is still expected to be high due to the accelerating transition to electric vehicles and soaring demand for high added-value parts, despite some concerns of a temporary slowdown of demand in the automotive parts industry. In light of such developments, LG plans to maintain its growth momentum by focusing on high added-value projects and acceleration of regional production at the LG Magna plant in Ramos Arizpe, Mexico.
The LG Home Entertainment Company recorded third-quarter revenue of KRW 3.57 trillion and an operating profit of KRW 110.7 billion. The company maintained its profitable growth by effectively managing marketing expenses despite increased LCD panel prices, while also diversifying profit sources based on the growth of content and services business built on its smart TV platform. The company is accelerating its transition from a product-based business to a platform-based media and entertainment business as the content and services market continues to grow. To this end, in addition to expanding collaboration with various content providers, the company is upgrading TV operating systems to expand the content experience of customers. The number of TVs powered by webOS, the foundation of LG’s content and services business, is expected to reach 300 million units by 2026.
The LG Business Solutions Company’s third-quarter revenue was KRW 1.33 trillion with an operating loss of KRW 20.5 billion. Both revenue and profitability weakened due to the softening of demand for IT products. As challenging business conditions persist, the company continues to innovate customer experiences with premium IT lineups such as commercial displays and foldable laptops that provide customized solutions, while also making progress in fostering the electric vehicle charger business, one of LG’s new growth engines.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on October 27, 2023, at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants are instructed to pre-register online to receive a private PIN. To participate in the conference call, dial +82 31 810 3130, enter passcode 6418# and then the PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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