Strong Demand for Premium LG Home Appliances and Auto Parts Drives Highest Quarterly Revenue in Company History
LG Electronics Inc. (LG) announced third-quarter 2022 consolidated revenues of KRW 21.2 trillion, an increase of 14.1 percent from the same quarter last year and the highest quarterly revenue in the history of LG Electronics. Operating profit for the third quarter was KRW 746.6 billion, 25.1 percent higher than the same quarter last year.
For the third quarter, the company recorded growth of revenues driven by increased sales of premium home appliances including new appliance categories and automotive parts. However, considering one-off costs incurred last year, operating profit declined due to weak demand caused by the global economic slowdown.
The LG Home Appliance & Air Solution Company reported revenues of KRW 7.5 trillion in the third quarter, an increase of 5.8 percent from the same quarter last year, recording the highest third-quarter revenue ever for the business unit. Operating profit of KRW 228.3 billion was lower than last year due to increased marketing investments and higher logistics costs. Revenue increase was driven by strong sales of premium appliances including new appliance categories such as hygiene products using steam technology in the key regions of North America and Europe. The business unit plans to continue its momentum by improving competitiveness of premium products and strengthening its mass-tier lineup, along with cost structure management to enhance profitability.
The LG Home Entertainment Company recorded revenues of KRW 3.7 trillion in the third quarter and an operating loss of KRW 55.4 billion, which reflected higher marketing investments in response to intensified market competition. LG’s Home Entertainment strategy will center on effectively managing marketing expenses and boosting the premium TV segment, in addition to nimble inventory management.
The LG Vehicle component Solutions Company achieved third-quarter sales of KRW 2.3 trillion, a 45.6 percent increase from the same period in 2021, marking the business unit’s highest quarterly revenue. Third-quarter 2022 operating profit was KRW 96.1 billion. The significantly higher sales
were driven by proactively responding to higher demand from automakers with efficient supply chain management. The company will continue to build strong relationships with global automakers and work to increase profitability through efficient cost structure management.
The LG Business Solutions Company recorded third-quarter revenues of KRW 1.4 trillion with operating loss of KRW 14.4 billion caused by higher raw material costs and increased global logistics costs. Revenues increased 9.7 percent from a year ago largely on the back of recovery of the B2B segment. The company plans to aggressively target the rebounding B2B segment by developing more customized solutions and expanding its product portfolio for stable growth, coupled with stabilizing the supply of major components, actively reducing costs and managing resources more efficiently.