The two South Korean consumer technology giants have posted financial results for Q1, 2019, and it's not looking too good for the Samsung and LG, at least in terms of their respective mobile businesses.
Let's start with Samsung. The headline here is that operating profit is down 63 percent compared to the same period last year. Revenues were also down by 20 percent, with Samsung pulling in just KRW 52.4 trillion (about $45.1 billion) compared to the $56.5 billion is brought in in Q1 2018.
In the past, Samsung has been able to cover for the slowdown in its mobile business with strong sales in its chip business, however, both NAND and DRAM sales were down. Samsung posted revenues of KRW 14.47 trillion (about $12.45 billion) for Q1 2019, and attributed the decline to "macroeconomic uncertainties, weak seasonality and inventory adjustments by datacenter firms". Samsung's display business also posted a loss.
The news is not much better over at Korean rival, LG. The LG Mobile Communications Company posted first-quarter sales of KRW 1.51 trillion (about $1.34 billion) which did at least narrow its quarterly operating loss to KRW 203.5 billion (about $181.05 million). That's still a lot of money to be losing, though.
LG says that it is continuing to rebuild its smartphone business and that, looking ahead, it is hoping the launch of LG V50ThinQ 5G smartphone can create positive momentum in the second quarter. The relocation of LG’s smartphone manufacturing center from Pyeongtaek, Korea to Haiphong, Vietnam will also help improve profitability. Just two months ago, we reported that LG's mobile division was losing $700 million a year.
So things are not so rosy for the mobile business in Korea, then. Can these two giants turn it around? Let us know what you think in the comments below.