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LG's mobile division ships record 7 million smartphones, no longer losing money

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LG phone stock
LG phone stock

LG Electronics has grown solidly over the past year, but its mobile business has seen less success than its TV and appliance divisions. With its latest earnings, though, the phone sector is no longer reporting a loss. The company has reported a net profit of 157 billion won ($139 million US); while sales are generally lower than last year, operating profits are higher. Its mobile sector, in particular, reported a 22 billion won ($20 million) operating profit, a sharp contrast from last quarter, when it reported a loss of $57 billion won ($49 million) because of marketing costs and competition at the low end of the market. It's also a dramatic improvement from last year, when it reported a 262 billion ($237 million) won loss.

Expect LG to push more of its flagship phones in the coming monthsIn the third quarter, LG shipped a total of 14 million phones, a 9 percent increase over last year. As Reuters notes, more profitable smartphones made up half that number, coming in at a record 7 million. LG says it saw growth both in 3G smartphones like the L series and in 4G LTE phones like the Optimus LTE 2 or Optimus Tag. In the coming months, it's planning to aggressively push flagships like the Optimus G and the large-screened Optimus Vu II. Feature phones, meanwhile, continue to decline, and with competitors like Huawei expanding, LG is clearly trying to push for more sales of high-end phones, even if can't compete with a behemoth like Samsung.

Despite this growth, most of LG's income still comes from the less flashy home entertainment and appliance businesses. Both are doing well, reporting a stable operating profit of 89 billion ($79 million) and 129 billion won ($114 million) respectively, and LG hopes that the rise of Ultra High Definition or 4K TVs will work in its favor. Unfortunately, there's still no mention of LG's much-anticipated OLED TV.