LG Electronics on Thursday published its consolidated financial report for the final quarter of 2018 and the entire 12-month period, revealing improved revenue and a number of positive results, albeit not without disclosing several concerning trends as well.
In terms of sales, LG’s 2018 turnover surpassed 60 trillion won for the second year in a row, having hit the equivalent of $54.4 billion over the last three months of 2018. At the same time, its bottom line improved by almost ten percentage points annually, amounting to some $2.4 billion. And while that improvement even managed to be somewhat diversified, none of LG’s latest successes are attributable to its only unit that’s been receiving a steadily increasing amount of effort and resources from its Seoul-based management in recent times – the one in charge of the firm’s Android device business.
On the contrary, the newest financial report primarily mentions the mobile division in terms of negatives, blaming it for a seven-percent drop in year-on-year turnover recorded over the final quarter of 2018 and a subsequent income decline. While the results aren’t particularly worrying in the context of LG ‘s business as a whole, the fact that LG’s sustainability still isn’t being threatened isn’t good enough for most investors, as evidenced by the fact that the firm’s stock dropped by close to two-percent before Seoul trading hours were up earlier today.
To put things into perspective, LG’s mobile unit lost nearly a quarter of all of its 2018 profit and while its losses aren’t as bad as they used to be, the continued revenue decline revealed by the firm’s new financials suggets the tech juggernaut can’t count on squeezing more money out of its existing customers as a viable long-term strategy; the profit margins it currently has are unlikely to get any better as the only type of products that might actually push them is expected to be competing in the smallest of niches until next ear at the eearliest. Naturally, the very concept of bendable handsets is something the industry has been exploring for many years now but despite now being on the verge of commercializing it, consumers aren’t likely to deem purchasing such devices somewhat affordable until at least 2021.
LG’s fourth-quarter report confirmed the company is currently exploring bendable handsets and will be releasing at least one such device before the end of the year, with previous rumors pointing to the middle of the year as the likely timeframe for the said market debut. The South Korean conglomerate also used the consolidated publication as an opportunity to promise its investors, fans, and regular industry watchers that it’s actively pursuing 5G smartphones which it intends to start releasing before the conclusion of 2018 as well.
The company previously announced a 5G partnership with Sprint but didn’t reveal many details on the matter. A new rumor that emerged online earlier this week indicates LG’s first 5G-ready Android phablet will be advertised as the V50 ThinQ 5G, yet previous rumblings pointed toward the direction of an entirely new name. Whatever LG has in store for consumers this year, it will certainly be hoping for it to bring in enough sales so that the company can avoid new questions about the fate of its mobile business which it repeatedly said isn’t going anywhere anytime soon.