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LG Mobile posts worst quarterly loss ever on the back of the LG G5
We all knew this day was coming: LG Mobile has posted its worst-ever quarterly loss thanks to the failure of the modular LG G5. Q3, 2016 represents the sixth straight quarterly loss for LG Mobile, even as LG’s TV division posted a record profit.
LG Electronics announced quarterly revenue of $11.8 billion and an operating income of $252.7 million. That’s a decrease of 5.7 percent and 3.7 percent respectively, compared to the same time last year.
LG Mobile sales dropped 23 percent from the same period in 2015, with “lower sales of premium devices and expenses related to business structure improvement activities” contributing to a record $389.4 million loss on $2.3 billion in revenue.
LG Mobile sales dropped 23 percent from the same period in 2015, contributing to a record $389.4 million loss.
Despite the dismal figures, LG still managed to ship 13.5 million devices in the quarter and saw shipments grow in North America by 14 percent compared to the previous quarter. The LG V20 will be a redemptive force in the final quarter of the year, along with mass-tier K and X series sales.
Fortunately, LG Mobile’s dramatic losses were offset by the particularly strong television unit. Against this dismal backdrop, LG Home Entertainment recorded its highest-ever profit with $3.7 billion in sales generating $340.4 million in operating profit.
Nevertheless, LG expects fourth quarter profit to be even weaker than the current quarter, due to high promotional expenses and the typical end-of-year weakness for home appliance sales.
Do these figures surprise you? Do you think the V20 is good enough to turn things around?