LG Electronics Breaks Quarterly Record in 12 Years... Home Appliances Soar (Update)

[Asia Economy Reporter Woo Su-yeon] LG Electronics has recorded its highest-ever performance in 12 years, driven by the home appliance market boom due to the COVID-19 special demand. This was influenced by the economic recovery trend and revenge consumption caused by COVID-19, with sales surging mainly in premium TVs and home appliances.

On the 7th, LG Electronics announced its preliminary results for the first quarter of this year, with sales of KRW 18.8057 trillion and operating profit of KRW 1.5178 trillion. Sales increased by 27.7% and operating profit by 39.2% compared to the previous year, marking the highest-ever performance in both sales and operating profit.

This is the first time in 12 years since the second quarter of 2009 (KRW 1.2438 trillion) that LG Electronics' quarterly operating profit has exceeded KRW 1.2 trillion. In terms of first-quarter sales, it also broke the record set in the first quarter of 2018 (KRW 15.123 trillion) after three years.

The strong performance this time was driven simultaneously by the TV business division and the home appliance division. In particular, sales of premium home appliances such as the Objet Collection, OLED TVs, and NanoCell TVs increased, which is estimated to have raised the overall average selling price (ASP) of products.

Especially, thanks to new product launches, the operating profit of the home appliance division is believed to have surpassed KRW 800 billion for the first time in this first quarter. At the beginning of this year, LG Electronics launched the 'LG Whisen Tower,' an air conditioner with a new design for the first time in six years, and the space interior appliance 'LG Objet Collection' continues to maintain steady popularity.

The TV business is also increasing sales by making this year the inaugural year of OLED transition. Market research firm Omdia estimated that LG Electronics' OLED TV shipments in the first quarter of this year reached about 759,000 units, more than double compared to the same period last year. The global OLED TV market surpassed 2 million units in sales for the first time last year and is expected to expand more than twice this year to about 5.6 million units.

Meanwhile, with LG Electronics' sudden decision to withdraw from the mobile business division, which had been suffering chronic losses, performance improvement is expected to accelerate from the second quarter. LG Electronics' strategy is to boldly reorganize low-profit businesses and shift the core of its business to new sectors such as automotive parts, robotics, and artificial intelligence (AI).

Industry insiders expect that LG Electronics' automotive parts business division could turn profitable in the second half of this year as demand for finished vehicles recovers. In July, the launch of the joint venture 'LG Magna e-Powertrain (tentative name)' with automotive parts company Magna is also scheduled.

This content was produced with the assistance of AI translation services.