LG Electronics Expects 13% Increase in Second-Quarter Operating Profit


LG Electronics, the South Korean consumer-electronics giant, has announced that it anticipates its second-quarter operating profit to rise by 13% compared to the previous year. This growth is primarily driven by the company’s vehicle-component business.

The estimated operating profit for the April-June period is 892.70 billion won ($681.7 million), and revenue is expected to increase by 2.7% to KRW19.999 trillion, which falls slightly below the market consensus estimate of KRW980.74 billion.

LG Electronics attributes the delayed recovery in demand for consumer electronics globally to intense market competition, specifically in the home-appliance and television segments, as stated in their recent statement. However, despite these challenges, the company’s vehicle-component business has performed exceptionally well and has been the primary driver of earnings growth in the second quarter.

In collaboration with Canadian auto-parts maker Magna International, LG Electronics has launched a joint venture called LG Magna e-Powertrain. This joint venture supplies electric-vehicle parts to leading U.S. automakers. Hana Securities analysts Roko Kim and Minkyung Kim value LG Electronics’ vehicle-parts segment at KRW9.9 trillion, significantly higher than their previous estimate.

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