LG Q4 2016 financial results show a weakening smartphone business
While Samsung reported respectable Q4 2016 financial results despite the Galaxy Note 7 disaster, LG is once again in the red with severe losses.
LG has reported slightly higher sales for Q4 2016 at 14.78 trillion Won (or about 12 billion USD) compared to 14.56 trillion Won in Q4 2015. Net loss, however, has almost doubled from 140.5 billion Won to 258.8 billion Won YoY. The company's 2016 fiscal year turnover has fallen slightly from 56.51 trillion Won in 2015 to 55.37 trillion Won. Profit during the same yearly time frames has fallen from 249.1 billion Won to just 126.3 billion Won.
A closer look at LG's divisions shows exceptionally poor performance from its Mobile Communications (MC) arm where revenue has shrunk from 14 trillion Won to 11.71 trillion Won. Its operating losses jumped from 119.6 billion to 467 billion Won in the same YoY time frame. In contrast, LG's Home Entertainment (HE) arm performed well last year due to reportedly healthy sales of OLED and UHD TV sets.
The LG G5 was touted as a modular smartphone where users can swap in and out proprietary accessories for increased functionality. Unfortunately, the novelty was more of a gimmick to the eyes of customers and sales of the G5 have been lukewarm at best.