LG Q1 2015 profits down 36.2% YoY, 15.4 million smartphones shipped


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LG Electronics has reported revenues of 13.99 trillion won (US$ 12.72 billion) in Q1 2015, an increase of just 0.04% compared to the same quarter last year with operating profit of 305.2 billion won (US$ 277.45 million), down 36.2 percent from the same period the previous year. Net profit was 38.4 billion won (US$35.9 million) during the quarter, down from 92.5 billion won a year earlier. Reason for no change in revenue even with soaring smartphone sales is due to modest revenue declines in TVs

Mobile Communications sector reported a quarterly revenue of 3.6 trillion won (US$ 3.27 billion), a 5% decrease compared to the same quarter in 2014 and a 5% increase QoQ. It shipped 15.4 million smartphones in the quarter, slightly less than 15.6 million in the previous quarter and 26% increase in shipments YoY.

Smartphone sales in North America increased 66% from the same period of 2014 and sales in Korea grew 57% from the previous quarter due to the introduction of the G Flex 2, even though sales in domestic market decreased by 25% YoY due to the influence of the handset distribution law reform.  Although sales increased slightly due to lower ASP because of 1.8% intensified competition and unfavorable global FX movements, operating profit margins improved both QoQ and YoY due to stronger sales from North America and efficient usage of resources.

LG expects smartphone market to grow continuously, especially for the LTE market. Competition to gain market share will be intensified in all regions with the launch of new models in the premium segment and stronger lineups from competitors, and with intensified price competition as a result of the sales expansion in the mass market, said the company. It plans to increase revenue in the second quarter by strengthening presence in the premium market with the launch of the G4 along with launching new models in the mass segment.


Author: Srivatsan Sridhar

Srivatsan Sridhar is a Mobile Technology Enthusiast who is passionate about Mobile phones and Mobile apps. He uses the phones he reviews as his main phone. You can follow him on Twitter and Instagram