LG Display Co.’s production line located in Paju, north of Seoul. (image: LG Display)
SEOUL, April 26 (Korea Bizwire) — LG Display Co. reported its fourth consecutive quarterly loss Wednesday as sluggish demand for smartphones, TVs and computers continued to stymie its panel business.
The major panel maker reported an operating loss of 1.09 trillion won (US$815 million) for the January-March period, compared with a profit of 38.3 billion won a year ago, with high inflation and rate hikes significantly dampening consumers’ appetite for tech gadgets.
It posted a net loss of 1.15 trillion won, swinging from a profit of 54.3 billion won a year earlier. Sales fell 31.8 percent to 4.41 trillion won.
LG Display said it has taken a hit from low seasonality, shrinking demand for TV and IT products and continued inventory adjustments.
Its efforts to streamline loss-making liquid-crystal displays (LCD) business also hurt its bottom line, the company said.
In the first quarter, panels for laptops and tablet PCs took up the biggest portion of LG Display’s sales at 38 percent, followed by panels for mobile devices at 32 percent, TV panels at 19 percent and panels for automobiles at 11 percent.
The photo provided by LG Display Co. on Jan. 2, 2023, shows its automotive display product.
LG Display went into a deficit in the second quarter of last year for the first time in two years as a pandemic-driven boom in IT devices ended amid rising prices and interest rates.
Demand has been falling rapidly over the past year for LCD and premium organic light-emitting diode panels (OLED).
Poor macroeconomic conditions have also caused businesses to cut orders in order to deplete their excessive inventories.
Global PC shipments are estimated to have declined more than 30 percent from a year ago in the first quarter, while smartphone sales are believed to have fallen around 12 percent.
TV panel shipments are projected to fall by 2.8 percent this year from a year ago.
LG Display said it aims to make a turnaround in the second half by expanding premium OLED panels for mobile devices and TVs and automotive display business and continuing its efforts to reduce costs.
“Albeit very weak, we are seeing some positive signals where there is an inventory restocking demand that is starting to pick up,” the company said during an earnings call, after a year of “a significant inventory correction phase” in the industry.
LG Display shares fell 2.22 percent to close at 15,840 won, underperforming the wider market’s 0.17 percent decline.
(Yonhap)
