LG Maintains Upward Growth Trajectory

LG Electronics continues to build up its brand in key global markets, relying on sleek and sophisticated products such as smart phones, left, and light-emitting diode (LED) backlit liquid-crystal display (LCD) televisions. / Korea Times

By Kim Tong-hyung
Staff Reporter

LG Electronics doesn't intend to be in second place forever behind its bitter industry rival Samsung Electronics. And the domestic battle has grown into a global one in recent years, with the two Korean high-tech juggernauts emerging as world beaters at the expense of competitors from Japan, Europe and North America.

Obviously, Samsung clearly has the upper hand in the Korean business sector's fiercest rivalry, as it is now the world's largest maker of consumer electronics products and memory chips.

However, LG is now starting to give Samsung Electronics a run for its money, gaining ground in the two areas Samsung calls its major markets ― flat-screen televisions and mobile phones.

LG recently edged Sony to trail Samsung as the second-largest maker of liquid-crystal display (LCD) televisions. The company is also the world's No. 3 handset vendor behind Nokia and Samsung, passing companies like Sony Ericsson and Motorola.

LG officials believe that 2010 will provide a truer test of the company's mettle, with Samsung eager to cement its leadership, and other global electronics giants such as Sony, Sharp and Motorola looking to put up a stronger fight to regain their lost market share during the recession.

However, LG seems confident of meeting the challenge head-on, inspired by a robust third-quarter driven by brisk sales of flat-screen televisions and mobile phones.

LG, which currently trails Samsung as the No. 2 liquid-crystal display (LCD) television maker, posted a sharp increase in net income and operating profit during the July-September period and expects its momentum to carry on to the holiday season.

The third-quarter net income of 807.2 billion won was more than a 30-fold increase from the 24.9 billion won during the same period last year, while global revenue rose to 13.9 trillion won, compared to the 12.1 trillion won a year earlier.

LG's third-quarter operating profit rose to 850.2 billion won from 570.5 billion won during the same period last year.

There are worries that LG will post more modest numbers in the fourth-quarter, with the price erosion in the television and mobile phones business and also an expected increase in marketing expenses resulting in lower profitability.