lg logo mwc 2015 2

LG Electronics has just announced its unaudited financial results for the first quarter of 2015 and it’s a particularly strong start to the year for the company’s communications (smartphone) division.

In total, LG posted a first quarter net profit of KRW 38.4 billion (USD 34.91 million) and an operating profit of KRW 305.2 billion (USD 277.45 million), both of which are up from the previous quarter. However, revenues remained stagnant compared with the first quarter of 2014, stuck at KRW 13.99 trillion (USD 12.72billion). The reason for this is a decline in revenue generated by LG TVs, but soaring smartphone sales have helped to offset this.

LG smartphone shipments grew by 26 percent year-on-year
Looking specifically at mobile, sales revenue is up 5 percent from the same quarter last year, reaching KRW 3.6 trillion (USD 3.27 billion). Smartphone shipments grew by an impressive 26 percent over the last 12 months, reaching 15.4 million units this quarter. North America was the biggest growth region for LG, with a 66 percent shipment increase compared with last year. Korea saw a similarly impressive 57 percent growth in sales, thanks to the popularity of the rather unique LG G Flex 2.

As for the rest of the business, the Home Entertainment Company saw first quarter operating profits decline by 5 percent year on year KRW 4.44 trillion (USD 4.03billion), while its home appliance company saw a year-on-year gain of 9 percent to KRW 229.3 billion (USD 208.45 million). Finally, LG’s Vehicle Component Company, a relatively new division setup in July 2013, recorded revenues of KRW 382.6 billion (USD 347.82 million) and an operating loss of KRW 2.4 billion (USD 2.18 million).

Overall, LG looks to be continuing to build on its success in the mobile market, having released a strong line-up of high-end and mid-range products for various markets. The mobile division is growing particularly well, although the competitive nature of the market appears to be taking some toll on LG’s margins.

With the newly unveiled LG G4 set to hit the global market in June, we’ll have to wait for the company’s third quarter results to judge the impact of this year’s flagship.

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