LG’s profits triple following record smartphone sales

LG has just reported a record quarter for mobile phone sales, showing that it’s taking advantage of a slump from arch-rival Samsung. LG sold 14.5 million handsets over the last quarter, its highest total ever and 20 percent more than last year — with more than a third of those LTE models. It chalked up most of the success to its well-reviewed top-of-the-line G3 handset, along with strong sales of its mid-range L products. LG’s mobile division scooped up $3.5 billion and put an end to three straight quarters of losses. Home entertainment also performed well, climbing 3% on the strength of higher-margin UltraHD 4K sets. All that resulted in an operating profit of $599 million, not nearly Samsung-level numbers, but at least LG’s are going up, not down.

LG Electronics Inc reported on Thursday its strongest quarterly profit in more than three years, beating analyst estimates thanks to a pickup in television sales and a turnaround in its mobile phone business. The world’s second-largest TV maker after local rival Samsung Electronics Co Ltd said profit at its TV arm improved in April-June from a year earlier, while its smartphone shipments rose 20 percent to a record 14.5 million handsets. The global TV market is showing signs of life as demand from advanced markets picks up, with sales of larger-sized ultra high-definition (UHD) TVs widely seen as a potential boost. But LG and market analysts said a likely rise in marketing costs by TV makers may limit the extent of any earnings boost. “The results were better than expected,” said HMC Investment analyst Greg Roh. “A key factor to watch is how well the G3 smartphone fares in the United States, but the outlook appears to be bright given the second-quarter numbers.” For the April-June period, LG Electronics reported an operating profit of 606 billion won ($589.04 million), compared with a 524 billion won mean estimate of 39 analysts polled by Thomson Reuters I/B/E/S.