LG Mobile lost 1.3 trillion won over 2016 with G5 copping the blame
Seven quarters have now passed since the Mobile Communication division of LG Electronics posted a profit, which was for the first three months of FY2015.
Over the course of 2016, LG Mobile lost 1.3 trillion won, with 467 billion won recorded as the operating loss for the fourth quarter. In absolute terms, this was an increase on the 436 billion won lost last quarter, but due to an increase in revenue from 2.5 trillion to 2.9 trillion won, a smaller relative loss quarter on quarter.
Compared to the same time last year, the difference has blown out by over seven times from the 61 billion won loss recorded in Q4 2015, and revenue has dropped from the 3.7 trillion won recorded that quarter.
LG said smartphone sales had dropped 8 percent year on year, and the culprit was the modular G5 launched earlier in the year.
"Profitability was hampered by weak sales of the G5 smartphone and higher marketing investments," the company said. "Introductions [sic] of the next G Series phone and mass-tier devices in the second quarter following Mobile World Congress are expected to help greatly improve the LG Mobile Communications Company's market position in 2017."
The company said its V20 flagship phone was seeing "strong sales".
Overall, LG Electronics posted an operating profit of 1.3 trillion won from revenue of 55 trillion won for the full year, an increase from the 1.2 trillion won in profit from 57 trillion won in sales made for 2015. LG said the profit jump came on the back of its home appliances, air solutions, and home entertainment products.
For the fourth quarter, the company posted a 35 billion won loss on 14.8 trillion won in revenue.