LG Electronics reported record revenue and operating profit for the second quarter of this year, driven by growth in its home appliances and automotive businesses. The expansion of premium product sales and improvements in cost competitiveness boosted profitability. The company is also accelerating growth in new businesses, including robotics and AI data center cooling solutions, alongside its B2B and subscription services.
On July 30, LG Electronics announced that its consolidated revenue for the second quarter reached 23.8265 trillion won, with an operating profit of 1.5791 trillion won. This marks a 14.9% increase in revenue and a 147% increase in operating profit compared to the same period last year.
Despite unfavorable external conditions, such as conflicts in the Middle East, the home appliances division continued to show solid growth. Increased TV sales due to sporting events and growth in the automotive sector also contributed to the overall revenue increase.
Operating profit more than doubled from the previous year, thanks to the revenue growth and the expansion of high-value product sales. Improvements in cost structures and supply chains, along with the implementation of an emergency management system to address uncertainties in the business environment, also enhanced profitability. The recognition of a one-time gain from tariff refunds on U.S. exports last year further contributed to this result.
The B2B and subscription businesses, key components of the company's structural transformation, continued to grow. In the second quarter, B2B revenue reached 6.5 trillion won, a 5% increase from the same period last year. Excluding LG Innotek, the B2B segment accounted for 36% of total revenue.
Revenue from the subscription business, which combines products and services, reached 660 billion won, also a 5% increase year-on-year. The company is expanding its competitive edge in home appliance subscriptions from the domestic market to overseas markets, strengthening its business model to generate continuous service revenue after product sales.
The Home Appliance Solutions (HS) division recorded revenue of 7.0757 trillion won and an operating profit of 685.9 billion won. This marks the first time quarterly revenue exceeded 7 trillion won, with an operating profit margin nearing 10% at 9.7%.
The two-track strategy targeting both premium products and mid-range volume zones has proven successful. Optimizing cost structures and supply chains, along with the tariff refund effect, contributed to profit growth. In response to potential demand stagnation in the third quarter, LG Electronics plans to focus on the relatively stable demand in the global South market and will also ramp up its robotics actuator business.
The Media Solutions (MS) division, responsible for TV and platform businesses, reported revenue of 5.1146 trillion won and an operating profit of 219.4 billion won. Sales of premium TVs, including OLED and QNED models, increased, and the division continued to grow in the global South region. The expansion of the profitable webOS platform business also supported performance improvements.
The Vehicle Solutions (VS) division achieved record revenue of 3.0259 trillion won and operating profit of 191.2 billion won for the second quarter. This marks the second consecutive quarter with revenue exceeding 3 trillion won, with an operating profit margin of 6.3%. The division is recognized for its stable revenue growth based on accumulated orders, establishing itself as a B2B cash cow.
The Energy Solutions (ES) division reported revenue of 2.7261 trillion won and operating profit of 235.8 billion won. Increased sales of air conditioners overseas contributed to revenue growth, maintaining a solid operating profit margin of 8.6%.
Leveraging its cooling and heating capabilities, LG Electronics is also expanding its AI data center (AIDC) cooling solutions business. The company’s independently developed cooling water distribution unit (CDU) is poised to enter the global AIDC supply chain. As the importance of heat management and energy efficiency in data centers grows with the expansion of AI infrastructure, LG plans to cultivate cooling solutions as a next-generation B2B growth driver.
* This article has been translated by AI.
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