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[UPDATE: Official Statement] LG Contemplates Exit From The Smartphone Market

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UPDATE: LG may not be heading towards the exit when it comes to the smartphone market / business. LG’s senior director wanted to calm things down following this report, as he provided us with a statement. You can read more about it here.

ORIGINAL ARTICLE: It seems like LG may exit the smartphone market after all, at some point in the future. A recent report suggested it may happen, and almost immediately after that, someone from the company denied it. The reaction was so fast we didn’t even manage to report on it, as it was flagged as false news.

About a week later, we have a new report, this time coming from The Korea Herald. In fact, the publication managed to get information straight from the company’s CEO, Kwon Bong-seok.

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There is an chance LG will exit the smartphone market entirely

LG’s CEO sent out a message to his staff, and hinted at a major change in the operation of the smartphone segment. To put things into perspective, LG’s smartphone business lost about 5 trillion won ($4.5 billion) over the last 5 years.

He did note, in his letter, that any change to the smartphone business doesn’t mean the jobs of its employees are in danger. The CEO confirmed that the employment will be maintained.

He also added: “Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice”. LG is “considering all possible measures, including sale, withdrawal, and downsizing of the smartphone business.”

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If the worse happens, around 60-percent of the staff would be moved and reassigned to other business units within LG Electronics. As most of you know, the company’s reach is far wider than just smartphones.

The company’s smartphone business faced losses for 23 consecutive quarters

As of last year. The company’s smartphone business posted losses for 23 consecutive quarters, all the way since the second quarter of 2015. The losses are simply too great, and LG has to change something.

LG’s CEO also said that the company is improving the profitability of the smartphone business by slashing costs. It also added that LG will “seek growth in the premium market next year”.

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By what was said here, it doesn’t seem like LG will kill its smartphone business entirely, at least not immediately. The company is expected to release a rollable smartphone soon, and it would be a shame if that doesn’t happen. Anything is possible at this point, though.