South Korean-based electronics company LG’a second-quarter financial results indicate the company’s mobile division is on the decline.
The smartphone division’s sales are down 21.3 percent compared to the same quarter from last year. The company blames this on “stagnant demand in the smartphone market and continued aggressive pricing by Chinese brands.”
Although sales increased from 6.8 percent compared to last quarter, the company’s mobile division is still operating at a $268.4 million USD (roughly $352 million CAD) loss.
LG attributes the downturn to “higher marketing investment to support the launch of new models and additional costs related to relocating smartphone production to Vietnam,” according to the company’s press release.
The company hopes that the introduction of a mass-tier phone and the arrival of 5G will help increase its profits in the future.
Since we’ve seen companies like Google and Huawei release mid-range phones with great success in the past year, it seems likely that LG might attempt to hit that market again too. After last year’s LG G7 One, the company has shown promise in releasing a solid smartphone experience with no filler.
Don’t worry about LG as a whole, however. The company’s overall profits set a new record with its successful home appliance profits and strong business solutions division.