LG Electronics is considering shutting down its mobile phone business rather than selling it to another company. Dong Ilbo confirmed the information yesterday, citing an industry source. According to the report, the smartphone business has failed to sell to Germany's Volkswagen and Vietnam's Vinegroup. News Bloomberg.
Last January, LG Electronics CEO Keo Bong-siak said the loss-making smartphone business was under discussion.
Another top LG official then told The Korea Herald that it was time for us to make a cold head decision in the face of increasing global competition for mobile devices. We are considering all possible steps, including selling, moving, and shrinking the smartphone business.
Yesterday, South Korea's leading daily, Dong Ilbo, reported that the electronics giant had halted the construction of a rotatable phone that was supposed to bring. It is learned that the construction work of that phone was stopped last month. The Seoul-based technology giant was planning to launch the phone in the first half of this year.
Dong Ilbo thinks the decision to stop building smartphones will have an impact on workers in early April.
Earlier this year, LG said that in 2020, the total revenue of LG Electronics was 63.28 trillion won or 5 thousand 845 million dollars, which is 31.1 percent more than in 2019. The company posted a record profit of 3.20 trillion won, or ৮ 2.85 billion, on the back of increased sales of premium home appliances and LED televisions. Besides, the sale of car parts has also played a role in this.
In the fourth quarter of last year, LG's sales were 16.8 trillion won, or 1.07 billion, an increase of 16.9 percent over the same quarter in 2019 and 11 percent over the previous quarter. Despite the impact of the Cavid-19 epidemic, LG's operating profit in the fourth quarter was 85.20 billion won or 571.9 million dollars. It has increased by 539 percent compared to the fourth quarter of 2019.
Last year, LG Mobile Communications earned 5.22 trillion won or ৬৬ 470 million. In the fourth quarter, it sold 1.39 trillion won (1.24 billion). Although it increased by 4.9 percent compared to the same quarter of 2019, it decreased by 9.2 percent compared to the previous quarter. The shortfall in 4G chipsets and declining sales of premium smartphones in overseas markets did not meet expectations in this segment.
Samsung, Huawei, Xiaomi, Vivo and Apple are now leading the global smartphone market, according to the International Data Corporation (IDC). LG lags far behind them in the smartphone market.