LG increases profits for 2020, but its phones still struggle

One day after Samsung shared its own earnings results for the last quarter of 2020, fellow Korean giant LG has posted its own, and the news appears to be equally positive. For the full year 2020, LG posted ₩63.26 trillion ($56.45 billion) in revenue and ₩3.20 trillion ($2.85 billion) in profits, a 31.1% increase in profit over 2019. The percentage increase is actually bigger than Samsung's, though LG has much smaller raw numbers overall.

For the fourth quarter specifically, LG saw sales worth ₩18.78 trillion ($16.76 billion), which is 16.9% more than the same period in the previous year and 11% more than its third-quarter revenue. Profits increased even more, with 2020's ₩650.20 billion ($580.19 million) representing a massive 539% increase over the same period in 2019.

As for which divisions helped that happen, LG's Home Appliance and Air Solution Company was the biggest contributor. Full-year revenue hit ₩22.27 trillion ($19.87 billion) and it made ₩2.35 trillion ($2.10 billion) in profit, two record-setting numbers for the company. The fourth quarter was also the highest-ever for LG, with ₩5.54 trillion ($4.94 billion) in revenue, a 20% increase year-on-year.

The LG Home Entertainment Company is the second most profitable division, obtaining ₩13.18 trillion ($11.76 billion) in revenue and ₩969.70 billion ($865.29 million) in profits for the entire year. Yearly profits were up 22.9% over 2019. As for the fourth quarter specifically, it posted ₩4.28 trillion ($3.82 billion) in sales - 7.9% more than the previous year - and ₩204.50 billion ($182.48 million) in profit.

The last division to make a profit for LG is its Business Solutions Company, which posted ₩6.01 trillion ($5.36 billion) in revenue and ₩457.88 billion ($408.51 million) in profit for the entire year. Sales for the fourth quarter increased 4.8% year-on-year to ₩1.51 trillion ($1.35 billion), though profits dropped to ₩70.30 billion ($62.73 million).

Turning to the negative side of things, we have LG's struggling mobile business. The LG Mobile Communications Company posted ₩5.22 trillion ($4.66 billion) in revenue for the entire year, but it resulted in an operating loss of ₩841.20 billion ($750.63 million). Sales in the fourth quarter were actually up 4.9% from 2019, reaching ₩1.39 trillion ($1.24 billion), but were 9.2% lower than the previous quarter. LG has been reported to be planning a sale or downsizing of its mobile business due to poor results.

Finally, the LG Vehicle Component Solutions Company obtained ₩5.80 trillion in revenue ($5.18 billion) for all of 2020, and that's a 6.1% increase over 2019. Quarterly results were even more positive, with ₩1.91 trillion ($1.71 billion) in revenue, representing a 41.3% increase over the same period in 2019. The company still lost ₩2 billion ($1.78 million) for the entire year, but that's also an improvement over the same period of 2019.

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