Loss-making LG smartphone business under pressure

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Loss-making LG smartphone business under pressure

Billy MacInnes
The challenge facing LG to compete with Apple and Samsung in the smartphone market has been laid bare in its third quarter results which showed a continuing decline in shipments and revenue from its handset operation.

Sales of handsets fell 9.5% compared to the third quarter of 2010 and were 16% down on the second quarter of 2011.The division, which made a loss of 140bn Won ($124m) on sales of 2,689bn Won, was the only loss-making part of LG's operations.

LG said it planned to allocate resources efficiently to improve profitability at the mobile division, to focus on the smartphone market and increase sales of LTE phones. 

The company is under pressure to improve performance in the smartphone market where competitors like Apple and Samsung are doing particularly well. LG's handset business hasn't turned a profit since Q1 2010 and cumulative losses since that period amount to 1,640bn Won.

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