LG has presented the results for the second quarter of 2020. Total revenues amounted to $ 10.51 billion, which means having earned 17.9% less than in the same period a year ago. For its part, operating profit reached $ 405.65 million, a bump of 24.1% less than in the second quarter of last year. The company has no choice but to size its distribution chain and its structural costs.
LG Home Entertainment Company sells much less
By divisions, LG Home Appliance & Air Solution Company It had a turnover of $ 4.2 billion in the second quarter of the year, 15.5% less than in the second quarter of 2019. Operating income here was $ 514.23 million, 12.5% less than a year ago.
However, the fall of the television segment and other multimedia elements for the home has powerfully caught our attention. Here, the division LG Home Entertainment Company, closed with sales of $ 1.85 billion, 24.4% less than in the second quarter of 2019. For its part, operating income was $ 92.37 million, 25.9% less than in the same period of the previous year. LG has limited its marketing investments in this segment.
The only good news is that the division LG Mobile Communications Company it entered 1,070 million dollars in the second quarter of the year, 31.1% more than in the first quarter, although they did not improve compared to the second quarter of the previous year. Despite this, LG has not been part of the top five global mobile phone vendors for a long time.
The two other LG divisions that remain to be reviewed also sell less. LG Vehicle Component Solutions Company sells 40% less than in the same quarter of the previous year while LG Business Solutions Company sells 12.6% less compared to the same period of the previous year.
TLC, Xiaomi or HiSense aspiring to take the place of LG in the most interesting segment
Another reason behind this fall of LG, which had a duopoly with Samsung in the TV market, quite a distance from Sony. And is that while the other Korean brand maintains its solid position, LG is threatened by the arrival of brands such as TLC, HiSense or Xiaomi, who are offering high-quality products and OLED technology similar to LG, at much more competitive prices.
This predicts that in the coming months, the always interesting and juicy mid-range, where LG maintained the bulk of its sales, will be an even more competitive field where users are already getting used to these new brands that are coming hard.