While a lot of other tech companies, such as Apple, Google and Intel, are currently having cash fights will all their profits, LG has just announced its first loss in seven quarters but is promising 2011 will be different as they focus on premium smartphones and tablets.
Despite the fourth quarter losses of £138 million, overall for 2010 LG posted a net profit of £693 million. The fourth quarter losses were attributed to a softening in its mobile phone sales which were propped up by increased sales of flat panel TVs and home appliances. However despite poor sales overall in the mobile phone sector in the final months of 2010, losses in LG's mobile division fell in comparison to the third quarter. This was on the back of good sales of the Optimus One and the Optimus 7.
Looking forward, LG stated: “"In 2011, the company will focus on profitability by launching more premium smartphones and differentiated tablet PC products while regaining its cost competitiveness in feature phones." With the launch last week in its home territory of South Korea of the world’s first superphone, the Optimus 2X we are likely to see more phones like this during 2011. As regards the tablet products, we are eagerly awaiting the Optimus Pad which will be LG’s first foray into the soon-to-be-bulging market.
While LG seem to be struggling at the moment, the financial results are heading in the right direction. Q4 losses for mobile phones are less than those in Q3 and while overall revenues are significantly down on 2009 results, LG has a broad enough range of devices including mobile phones, tablets (coming soon), TVs and even home appliances to make it safe for the future. We will be eagerly awaiting LG’s “differentiated” tablet products in 2011, starting out with a possible Optimus Pad launch at Mobile World Congress.