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LG G2 marketing costs causes lowest quarterly profits this year

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LG G2
LG G2

LG has posted its lowest quarterly profits for the year due to the costs of its LG G2 marketing.

The South Korean electronics manufacturer’s mobile business has slipped into the red because of the money it spent marketing the LG G2 flagship.

Reported revenues for the Q3 2013 period were $12.51 billion (£7.73 billion), which is down year-on-year. Despite this, operating profit rose 27 per cent to $196.34 million (£121 million).

Overall, LG highlighted a 24 per cent increase in smartphone and tablet revenues for Q3 2013 rising to $2.75 billion (£1.7 billion), shipping over 12 million smartphones for the three-month period.

“LG plans to focus on increasing sales of new premium products such as the LG G2 smartphone during the peak holiday season as well as maximising 3G and mid-tier mass devices such as the L2 Series and F Series”, said LG in a statement.

The company even predicts its mobile revenue will rise for Q4 as the LG G2 and LG G Pad 8.3 only arrived at the end of Q3.

However, the joy at the strengthening mobile division is impacted by the LG Home Entertainment Company, which saw revenues fall 7 per cent from the same period last year. This fell to $4.5 billion (£2.8 billion), “reflecting slower global TV demand and lower selling prices”, said LG.

“As it enters the holiday selling season, LG plans to expand global sales of premium products such as OLED TVs and Ultra HD TVs while continuing to carefully manage costs.”

However, LG’s Home Appliance division seems to be doing rather well. It reported revenues of $2.68 billion (£1.65 billion), up 3 per cent from the same period last year due to the introduction of new washing machines and fridges.

Next, read our pick of the best TVs of 2013.

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