LG makes less profit on TVs due to lower prices

LG’s operating profit on TVs fell sharply in the past quarter due to the lower prices that the manufacturer had to use. The price cuts were necessitated by competition in the expensive TV market.

Where LG still had an operating profit of 9.2 percent for the whole of 2018, that had fallen to 2.4 percent at the end of 2019, according to the quarterly figures. In addition to the price reductions, LG also made more marketing costs, the manufacturer notes. The lower prices stood out; the price of certain models of OLED TVs regularly fell below 1000 euros. That was unthinkable a few years ago. LG expects to sell more expensive TVs this year.

LG is going to release cheaper phones with 5G support this year. Last year, the company only released the high-end V50 ThinQ with 5g, but this year there should also be midrange models with support for the new generation mobile network, according to the report.

In the fourth quarter of 2019, the group recorded a turnover of 16 trillion Korean won, equivalent to approximately 12.2 billion euros. That is 1.8 percent more than a year earlier. The operating income was converted to 770 million euros, which is 26 percent more than the year before.

Looking back: preview of LG TVs for 2020 from CES