LG Electronics operating profit drops 10.8% on year in first quarter

LG Twin Tower in Yeouido, western Seoul [NEWS1]

LG Electronics’ operating profit was down 10.8 percent on year to log 1.3 trillion won ($945 million) for the first quarter, deriving from stellar performances by its home appliances and business-to-business (B2B) deals despite the sluggish macroeconomic environment.

The figure beat market expectations by a narrow margin, which had forecast 1.29 trillion won, according to market tracker FnGuide.

Quarterly revenue inched up 3.3 percent to 21.1 trillion won, slightly below analysts’ expectations of 21.25 trillion won. The figure matched the preliminary result announced earlier.

Its Home Appliance and Air Solution (H&A) division reported 940.3 billion won in operating profit, marking the second-highest quarterly figure in LG’s history. Revenue jumped 7.2 percent to 8.6 trillion won, the highest out of all quarterly earnings.

“Despite continued macroeconomic challenges, we maintained growth in the B2B sector by introducing business models capable of sustaining continuous revenue and profitability such as subscription-based services,” LG said in a statement. “We also strengthened our competitive edge by emphasizing AI, energy efficiency and customer-centric design to diversify our lineup and pricing strategies.”

The company’s vehicle solution business also fared comparatively well despite forecasts of a slowdown in the EV market.

Third quarter revenue jumped 11.5 percent to 2.66 trillion won with the operating profit recording 52 billion won.

The Home Entertainment division generated 3.49 trillion won in revenue and 132.2 billion won in operating profit.

Its Business Solution, which includes the EV charging business, reported 1.58 trillion won in revenue and 12.8 billion won in operating profit.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]