LG Electronics sets smartphone sales record in second quarter

LG Electronics reported improving net income rates in Q2 2013 today -- surpassing analyst expectations with only a 9 percent drop in quarterly profit.

The South Korean television set maker's second quarter earnings report beat forecasts as strong smartphone sales offset weakening consumer demand for television sets.

Operating profit fell to 479 billion won ($427 million) in April to June, in comparison to 526.7 billion won in the previous year and 349.5 billion won in Q1 2013. The firm's net profit for the quarter is 156 billion won ($139 million).

As demand for home-based electronics wanes, the increasing popularity of smartphones has improved the company's future prospects. In Q2, LG reported sales record of 12.1 million smartphones, the highest rate in the firm's history. Revenue rates of 3.12 trillion won ($2.78 billion) were reported by LG, an increase of 34.5 percent year-on-year.

The company has forecast a year-on-year increase in third-quarter profit and revenue margins due to the boost in smartphone sales. LG hopes that the flagship G2 smartphone, due to go on sale next month, will help the company secure a larger segment of the global smartphone marketshare.

In addition, LG hopes that by investing in the large television screen market, premium-priced products will help the firm compete against fierce competition and weak global demand.

However, as consumer demand wanes for home appliances due to the change in season, the firm predicts a slow-down in sales of appliances and air conditioners.