LG Display posts profit but iPhone dims outlook

Jan 24, 2013 by Youkyung Lee

LG Display reported a $299 million profit for the fourth quarter Thursday thanks to mobile product launches by key customers including Apple Inc. but warned that earnings will decrease in the current quarter as demand for iPhones wanes.

The South Korean panel maker said its October-December net profit totaled 319.7 billion won ($299 million) compared with a loss of 6.3 billion won a year earlier when the European Union fined the company 215 million euros for price fixing. Sales rose 32 percent to 8.74 trillion won.

LG forecast a profit drop for the current quarter because it expects to ship fewer panels to and mobile device makers. In particular, shipments of panels for mobile phones and will likely decline to 25 percent of total sales from 31 percent in the fourth quarter.

LG's financial performance has become closely linked with Apple, which is the world's second-largest smartphone supplier after . LG Display also makes TV panels but sluggish demand for TVs has made smartphones and tablets more crucial for its growth.

Apple accounted for two thirds of LG Display's total profit during the second and third quarters of 2012, Samsung Securities analyst MS Hwang said in a report.

Apple's Wednesday showed that its sales of iPhones, and Mac computers were each 1 million units short of market expectations. The Cupertino, Calif.-based company also gave sales guidance that fell short of expectations.

Many brokerages have lowered LG Display's sales outlook and share price target recently, citing concerns about demand for Apple's . Analysts said an increase in iPad mini sales in lieu of other iPad models that use bigger screens will also reduce LG's profit.

James Jeong, LG Display's chief financial officer, said the panel industry, which has been suffering from oversupply and weak global demand for years, is not expected to make a big improvement for another year.

Jeong said LG Display will have almost no increase in its production capacity this year, underlining how the tech sector is still reluctant to increase investment in factories at a time of global economic uncertainty.

LG's fourth quarter profit fell short of the 352 billion won median forecast by analysts polled by FactSet.

Operating profit totaled 587.3 billion won, compared with a 154.7 billion won loss a year earlier.

Explore further: Musk approached Google on Tesla sale in 2013: book

0 shares

Related Stories

LG Electronics post profit on smartphone sales

Oct 24, 2012

(AP)—South Korean consumer electronics maker LG Electronics Inc. reported a third straight quarterly profit on Wednesday as sales of smartphones designed for faster wireless networks helped end losses at ...

LG Electronics 2Q net profit plunges, sales fall

Jul 27, 2011

(AP) -- LG Electronics, a top global manufacturer of mobile phones and flat-screen TVs, said second-quarter net profit plunged as sales declined and its mobile phone business remained in the red.

LG Electronics' profit falls as mobile loses money

Jul 25, 2012

(AP) — LG Electronics reported a lower quarterly profit as its mobile phone division sank to a loss and forecast its earnings to deteriorate further, underlining the challenges for its smartphone business ...

Recommended for you

IBM earnings dip as sales fall again

9 hours ago

Technology heavyweight IBM reported Monday lower profits in the first quarter following another drop in revenues, this time partly due to the strong dollar.

Global, Chinese automakers debut new car models

20 hours ago

Ford showed off its new Taurus and Nissan unveiled a midsize sedan designed for China on Monday at a Shanghai Auto Show that highlighted the commercial resurgence of lower-priced Chinese auto brands.

Germany still has some way to go to 'smart factories'

Apr 19, 2015

Collaborative robots and intelligent machinery may have wowed the crowds at this year's Hannover Messe, but experts see German industry as having some way to go towards incorporating them on factory floors ...

Taiwan factory workers win $18 mn over cancer deaths

Apr 17, 2015

Workers from a factory in Taiwan which leeched toxic chemicals they say resulted in 200 deaths from cancer and more than 1,000 other cases of the disease won a Tw$564.45 million ($18 million) payout from US electronics company ...

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.