LG Electronics (066570) reported preliminary second-quarter results on the 7th, posting revenue of 23.83 trillion won and operating profit of 1.5788 trillion won. Both figures beat the one-month consensus estimates of 22.7949 trillion won and 1.4226 trillion won, respectively. Revenue and operating profit rose 14.9% and 146.9% year-on-year, marking record highs for a second quarter.
Second-quarter revenue climbed as sales rose in core businesses such as home appliances and TVs, supported by the company's premium market position. Air conditioner sales increased, particularly in overseas markets amid the seasonal peak, while continued growth in the automotive components business offset concerns stemming from uncertainties such as the Middle East war.
Second-quarter operating profit more than doubled from a year earlier. In addition to the leverage effect from revenue growth, continued expansion of high-margin businesses such as webOS, appliance subscriptions and online sales contributed to improved profitability. The operating profit is known to reflect several tens of billions of won in costs from a voluntary retirement program carried out in April.
LG Electronics has also been pursuing refunds for tariffs paid on U.S. export volumes last year, and recognized one-time gains on amounts confirmed for refund. According to the industry, the total tariff refund is estimated at 300 billion won.
The Home Appliance Solution (HS) business sustained growth with a two-track strategy targeting both the premium and volume zones simultaneously, and also expanded its business-to-business (B2B) appliance business, including commercial washing machines and built-in appliances. The component solutions business is accelerating growth by broadening its portfolio beyond appliance components such as compressors and motors to robot actuators.
The Media Entertainment Solution (MS) business showed improved earnings compared with a year earlier, led by new premium TV products such as OLED evo and Micro RGB.
The Vehicle component Solution (VS) business continued to grow on the back of a high order backlog and strategic customer partnerships. The company plans to sustain profitability-based growth in the second half through efforts to improve its cost structure.
The Eco Solution (ES) business saw sales rise, particularly in overseas markets such as Europe, where record heat waves persisted. The company is responding to new demand for products such as heat pumps and unitary systems, and continues to invest in securing opportunities in AI data center cooling solutions.
