The fate of LG’s struggling smartphone business has apparently been sealed, with the South Korean company reportedly giving up on attempts to sell off the division and instead preparing to announce it’s being shut down completely. Times have been tough for LG, with its attempts to innovate in mobile getting consistently overshadowed by Samsung, Apple, and others.
To be fair, those attempts haven’t always hit the mark. LG’s iterative approach on its flagships struggled to gain attention in the face of rivals’ big budget marketing, while its experiments with twin-display phones seemed clunky in comparison to foldable screen devices from the competition. While LG seemed poised to change all that this year, with its first rollable phone as teased at CES 2021 in January, the likelihood of that device ever actually making it to production was looking increasingly dire.
Underscoring that have been regular rumors and leaks that LG was hunting a suitor for the mobile division. Chatter around that process suggested it had all been in vain, however, with leaks earlier this week promising a final shut-down was in the pipeline. That’s something sources tell The Korea Times looks almost certain now.
Having tried – and failed – to sell off the smartphone business to Vitenam’s Vingroup and others supposedly interested buyers, the report says, LG Electronics will now all time on the money-losing division. The public announcement is tipped to take place on April 5, when LG will hold a board meeting. LG officials declined to comment specifically on the leaks.
“All we can say is that every possibility is open,” the unnamed spokesperson said. “Although we cannot confirm that right now, we will announce the specific direction of our mobile communications business.”
While a disappointment to the lingering cohort of LG phone fans, it would undoubtedly be a sensible strategy given the rest of LG’s business. Despite the ongoing pandemic, the company recorded record operating profits of $2.85 billion in 2020, up more than 31-percent compared to the previous year. Sales in Q4 2020 specifically rose 11-percent over Q3, and almost 17-percent compared to the same period twelve months prior.
LG credited premium home appliance sales and OLED TV demand, in addition to vehicle components, for the uptick in profits. Indeed, when it comes to appliances, LG’s Q4 2020 was the best quarter in the company’s history.
In contrast, LG cited “sluggish sales of premium smartphones in overseas markets” along with a shortage of 4G LTE chipsets for disappointing performance in mobile. The outlook remained fairly glum for that division, unlike LG’s relatively upbeat predictions for the rest of its teams.
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