US Tariff Burden, Voluntary Retirement Yet Surpass Market Expectations
Cho Joo-wan “Accelerating Qualitative Growth Centered on Auto Parts and HVAC”,
ⓒDailyanDB, ‘[Dailyan = Reporter Lim Chae-hyun] Despite headwinds from US tariff burdens and workforce restructuring, LG Electronics has released preliminary third-quarter results exceeding market expectations, signaling the potential for a full-scale implementation of a ‘qualitative growth’ strategy.’,
, ‘On the 13th, LG Electronics announced in a provisional disclosure that its consolidated sales for the third quarter this year were 21.8751 trillion KRW, with operating profit at 688.9 billion KRW. Although sales and operating profit decreased by 1.4% and 8.4% respectively compared to the same period last year, they increased by 5.5% and 7.7% from the previous quarter.’,
, ‘In particular, operating profit exceeded market expectations (approximately 600.5 billion KRW) by more than 10%. Financial information company FnGuide had pegged LG Electronics’ third-quarter consensus (average forecasts from securities firms) at sales of 21.2278 trillion KRW and operating profit at around 600.5 billion KRW.’,
, ‘Consequently, evaluations from the market suggest that the company performed better than expected amid challenging conditions such as US tariffs and the restructuring of its deficit-ridden TV division. LG Electronics stated, “The home appliance and auto parts divisions supported the results, defending the lower end of the performance spectrum.”‘,
, ‘Notably, the auto parts (VS) division is expected to have achieved record-high profitability. The expansion of sales in high value-added products like vehicle infotainment has driven the improvement in profitability. The company is currently expanding its business model from a hardware-centric approach to a content platform.’,
, ‘Additionally, the company anticipates stable growth in its lamp and electric vehicle component business based on substantial order backlogs.’,
, ‘The heating, ventilation, and air conditioning (HVAC) division is said to be continuing to secure new orders centered on commercial air conditioning systems and large chiller businesses, including AI data center cooling solutions. Particularly, the commercialization of liquid cooling technology for data centers is highlighted as a mid- to long-term growth driver.’,
, ‘In fact, the auto parts and HVAC sectors are areas where LG Electronics is placing its hopes for future growth. LG Electronics President Cho Joo-wan attended the IFA 2025 in Berlin last month, expressing significant expectations by stating that “visible results in B2B areas like automotive parts and air conditioning will materialize.”’,
, ‘The home appliance (HS) sector is expected to have delivered stable results through a strategy focused on the premium market and optimized resource and production site management, despite tariff burdens and a global demand slowdown. Subscription services and product-service combination models are reportedly contributing increasingly.’,
, ‘The TV division (MS), burdened with one-off costs from voluntary retirements and increased marketing expenses, aims to reverse this through diversification of its revenue structure by strengthening the webOS platform, expanding content, and enhancing advertising business. The company plans to bolster its efforts in the relatively resilient ‘Global South’ region.’,
, ‘Meanwhile, LG Electronics is particularly seeking new fund raising and accelerating local business through the IPO of its Indian subsidiary. Industry experts view capital inflow through the Indian subsidiary as a favorable turning point for improving business structure and pursuing future high-growth businesses.’,
, ‘However, tariff risks, global economic slowdown, exchange rates, and logistics costs remain external uncertainties that could burden fourth-quarter earnings. It will be noteworthy to see whether the high-profit trend in auto parts and increased demand in HVAC can offset these downward risks. LG Electronics plans to disclose detailed third-quarter results and strategies for the second half at the scheduled earnings briefing later this month.\n’]