'Strong Performance in Home Appliances and Automotive Components' LG Electronics Achieves Record Quarterly Sales in Q2 (Update)

Operating Profit of 741.9 Billion KRW Surpasses Samsung Electronics Again

LG Electronics announced on the 27th that it recorded consolidated sales of KRW 19.9984 trillion and operating profit of KRW 741.9 billion in the second quarter. Compared to the same period last year, sales increased by 2.7%, but operating profit decreased by 6.3%. In terms of operating profit, LG Electronics led Samsung Electronics by KRW 73.4 billion, maintaining its superiority for the second consecutive quarter.

Second-quarter sales reached the highest level among all second quarters in history, despite delayed demand recovery due to the global economic slowdown and intensified competition, as the proportion of B2B transactions such as automotive components and heating, ventilation, and air conditioning (HVAC) continued to expand structurally.

Operating profit decreased by about 6.2% compared to the same period last year due to non-recurring factors related to personnel restructuring such as voluntary retirement conducted at the beginning of the year and one-time costs including increased material costs from the recall of General Motors (GM) 'Chevrolet Bolt EV.' However, despite these one-time costs, LG Electronics minimized the impact on profitability through growth in platform-based businesses such as content and services and efforts to improve corporate structure led by the company-wide war room task force.

Photo by Yonhap News

By division, the Home Appliance & Air Solution (H&A) Business Division recorded sales of KRW 7.9855 trillion and operating profit of KRW 600.1 billion in the second quarter. Despite market demand slowdown and intensified competition among companies, the business fundamentals and growth of the high-efficiency and eco-friendly B2B HVAC business continued. Notably, operating profit increased by nearly 40% compared to the same period last year. Efforts to stabilize cost structures such as raw material and logistics costs also contributed to achieving high profitability.

The Home Entertainment (HE) Business Division posted sales of KRW 3.1467 trillion and operating profit of KRW 123.6 billion in the second quarter. In response to demand slowdown in key markets due to geopolitical issues in Europe, the division maintained an efficient business operation approach. Although sales slightly decreased compared to the same period last year, operating profit significantly increased due to marketing cost efficiency improvements and diversification of profit structure through growth in platform-based content and service businesses with high profitability.

The Vehicle Components (VS) Business Division achieved sales of KRW 2.6645 trillion and operating profit of KRW 89.8 billion in the second quarter, reaching the highest sales and operating profit among all second quarters, maintaining a continuous growth trend. However, during the recall process of GM's 'Chevrolet Bolt EV' that occurred in 2021, one-time costs related to increased vehicle parts material costs amounting to KRW 151 billion were reflected in the second-quarter results, ultimately resulting in an operating loss of KRW 61.2 billion.

The Business Solutions (BS) Business Division recorded sales of KRW 1.3327 trillion and operating profit of KRW 2.6 billion in the second quarter. Both sales and operating profit slightly decreased compared to the same period last year due to prolonged decline in IT product demand.

LG Electronics stated, "In the third quarter, we will capture customer demand early based on more precise demand forecasting and strengthen product competitiveness in the market. We will also focus on securing a stable profit structure by reinforcing the direct-to-consumer (D2C) strategy through online brand stores and maximizing business efficiency."

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