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LG Third Quarter Results Better Than Expected

October 29, 2015 - Written By David Steele

LG is regarded as one of the top Android smartphone manufacturers and in recent years, the flagship models have bought a slightly different set of features to the industry. The LG G2 featured an ultrathin side bezel on the screen and mounted the buttons on the rear of the smartphone rather than on the side. The LG G3 represented an evolution of the G2, bringing increased performance to the device, a much cleaner user interface, an improved camera and a laser autofocus function. The 2015 LG G4 again mixed things up by using a slightly lesser System-on-Chip than the current flagship Qualcomm Snapdragon, as LG used the Snapdragon 808 rather than the Snapdragon 810. LG are also one of a very small number of Android manufacturers able to turn a profit from selling smartphones (even though their profit is a penny a unit).

LG announced third quarter results and despite these falling over one third from last year, the business still beat expectations. The reason for LG beating analysts’ forecasts is because the television unit returned to a profit after recording a loss in the second quarter. During the July to September period, the television unit reported a profit of 294 billion won, a little over $250 million – but down from 465 billion won for the same time last year. The industry expected the television unit to report a profit of 266 billion won. LG’s television business unit is benefiting from the industry trend towards UHD and IPS display panels and moving away from smaller sets with lower resolution display panels. This is a trend we are also seeing in smartphones, where many flagship smartphones are using screens above 5.2-inch and of QHD, or 1440p, or 2,560 by 1,440 pixel resolution. Mid range devices – such as the LG’s newly released Nexus 5X – typically use a slightly smaller screen of 1080p resolution, which two years ago would have been considered flagship quality.

LG’s television unit is ranked the second largest in the world behind another South Korean electronics manufacturer, Samsung. Unfortunately for LG, this is true across many business units including smartphones. The industry, and Samsung, needs ongoing competition in order to further develop and innovate current and next generation products.