LG is considering leaving the smartphone business entirely amid a drop in shipments and accumulated losses of $ 4.5 billion over the past five years (via The Korea Herald)
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LG CEO Kwon Bong-Seok warned the team earlier today that the company is reevaluating its presence in the smartphone industry:
As competition in the global mobile device market is getting tougher, it’s time for LG to make a cold judgment and make the best choice. The company is considering all possible measures, including selling, withdrawing and downsizing the smartphone business.
He added that, regardless of any changes, the company will retain its current employees in the smartphone division and transfer them elsewhere.
LG has seen a rapid decline in smartphone sales in recent years, and the company is now believed to have a market share of just 2%. LG recorded large financial deficits in its smartphone segment for 23 consecutive quarters, reaching a total loss of $ 4.5 billion.
Upon taking over as CEO in January 2020, Kwon promised to turn the company’s smartphone business around. The CEO’s most recent comments, therefore, appear to be an admission of failure to make the segment profitable.
At the same time, LG is ending production of LCD monitors for the iPhone, according to He c. LG Display had previously tried to provide LCDs for the second-generation iPhone SE, but it did not meet Apple’s requirements, causing Japan Display and Sharp to be selected as suppliers. The LG plant, which previously manufactured the components, will be reused to make car display panels.
Earlier this month, LG unveiled one of the world’s first scrollable smartphones at CES, while the company struggled to explore unusual designs to attract customers. The future of this device and other LG smartphones, such as the LG Velvet and LG Wing, is now highly uncertain.