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LG Display “A significant portion of the panel inventory adjustment that has been ongoing since last year is expected to turn profitable in the 4th quarter”

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LG Display’s 2Q 2023 Performance Summary

LG Display’s 2Q 2023 Performance Summary

In a conference call on LG Display’s Q2 2023 earnings announcement held on the 26th, LG Display CFO Seong-Hyeon Kim announced, “As a significant portion of panel inventory adjustments have been made, a turnaround is expected in the fourth quarter of this year.”

Since last year, intensive inventory adjustments in downstream industries have continued, centering on TV and IT products, and panel inventory levels across the industry ecosystem have been declining. In the second quarter, demand for mid- to large-sized panels, including OLED TVs, increased and shipments expanded. Compared to the previous quarter, shipment area increased by 11% and sales increased by 7%.

Sales by product (based on sales) in the second quarter were 24% for TV panels, 42% for IT panels (monitors, laptops, tablet PCs, etc.), 23% for mobile panels and other products, and 11% for automobile panels.

LG Display plans to continue to promote ‘advanced business structure’ centered on ‘order-based business’ and expand the proportion of OLED business. It plans to further increase the proportion of OLED and business competitiveness in all large- and small- and medium-sized products. This year, OLED sales are expected to exceed 50%.

In the small and medium-sized OLED sector, it plans to make efforts to expand mobile product shipments based on the expanded production capacity, while further solidifying its leadership in IT OLED technology and preparing for mass production and supply systems in 2024 without a hitch. The automotive display business plans to focus on increasing sales and order receipts based on various and differentiated technological competitiveness that encompasses tandem OLED and high-end LCD.

Kim Seong-hyun, CFO of LG Display, said, “It is judged that the inventory adjustment of downstream industries, which has been ongoing since last year, has progressed considerably since the first half of the year.” Thanks to the expansion of order-based business performance, such as increased shipments, we expect a turnaround in the fourth quarter.”

LG Display announced that it recorded sales of KRW 4,738.6 billion and operating loss of KRW 881.5 billion in the second quarter of 2023.

▶ 2023 Medium and Large OLED Display Annual Report Sample Download

Samsung Electronics, Display Business division’s operating profit in the second quarter of 2018 was KRW 140 billion.

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Samsung Electronics announced its sales of KRW 58.48 trillion and operating profit of KRW 14.87 trillion through the earnings conference call of the second quarter, 2018 on July 31. Its sales decreased by 4% YoY and the operating profit increased by KRW 800 billion. Sales decreased 3% QoQ and operating profit fell by KRW 800 billion QoQ.

According to Samsung Electronics, the display panel business recorded sales of KRW 5.67 trillion and operating profit of KRW 140 billion, due to slowing demand for flexible OLED panels and declining sales of LCD TV panels. Despite improved utilization of rigid OLED, OLED division’s earnings declined QoQ due to continued weak demand for flexible products.

Competition with LTPS LCD is expected to intensify at rigid OLED in the second half of 2019, but earnings are to improve on increased sales following the recovery of flexible product demand. Sales and operating profit are projected to improve in the second half on the back of production of flexible OLED for Apple’s new iPhone models from 2Q.

Samsung Electronics plans to expand its share of OLEDs for mobile devices by strengthening its differentiated technology and cost competitiveness, and to strengthen its capacity for new products such as foldable OLEDs. Samsung official said that foldable OLED will contribute to growth from next year rather than immediate performance in the second half of the year.

IT • Mobile (IM) division posted sales of KRW 24 trillion and operating profit of KRW 2.67 trillion. Operating profit fell 34.2 percent from KRW 4.06 trillion in the same period a year ago, and also fell sharply from the previous quarter (KRW 3.77 trillion). In 2Q, handset sales reached 78 million units, of which 90% are smart phones. 5 million units of tablet were sold. The average selling price (ASP) of the handsets is in the second half of US$ 220. The Consumer Electronics (CE) division posted sales of KRW 10.4 trillion and operating profit of KRW 510 billion in the second quarter of the year. Overall sales and operating profit of the first half of the year were KR W 20.14 trillion and KRW 0.79 trillion, respectively. TV profits improved thanks to robust sales of high value-added products such as QLED TVs amid the global sports events. On the other hand, SEC’s facility investment in the second quarter was KRW 8 trillion. By business, semiconductor area accounted for KRW 6.1 trillion and KRW 1.1 trillion was invested for display area. In the first half, a total of KRW 16.6 trillion was invested; including KRW 13.3 trillion in semiconductors and KRW 1.9 trillion in display.

OLED TV, leading the premium TV market, LG Electronics HE division created the largest operating profit

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On the 26th, LG Electronics announced its 2017 Q3 performance through conference call. LG Electronics recorded consolidated sales of KRW 15.2241 trillion in 3Q and operating profit of KRW 516.1 billion. Sales and operating profit grew by 15.1% and 82.2% YoY respectively. Sales are the highest in 3Qs ever.

In particular, sales of premium TV increased, and HE division posted record-high quarterly results with operating profit (KRW 458.0 billion) and operating margin (9.9%). In addition, operating profit (KRW 882.9 billion) and operating margin (9.2%) are the highest in the household appliances business including household appliances and TVs.

LG Electronics announced that its HE division posted sales of KRW 4.6376 trillion and operating profit of KRW458 billion, and sales of premium TVs such as OLED TVs and UltraHD TVs increased steadily, with 12.0% YoY growth. It is known that the operating profit and operating margin (9.9%) reached a record high on a quarterly basis due to improved profit structure by expanding sales of premium products.

LG Electronics said on Oct 11 that monthly sales of OLED TV have exceeded 10,000 units for the first time in Korea and that it is speeding up its popularization. LG OLED TV has been recognized for its image quality by being awarded the top spot in the performance evaluation conducted by non-profit consumer magazines in 11 countries including the US and UK this year and the price of the 55-inch OLED TV has dropped to the mid-2 million level, and It is regarded as the cause of goodness of its sales.

LG OLED TV accounted for about 30% of domestic TV sales of LG Electronics, and it is known to have completely settled in the market. LG Electronics official announced plans for the future, ” HE division plans to continue sales growth and stable profit structure focusing on premium products such as OLED TV and UltraHD TV.”