2023-10-25 12:01:50
LGD records 4.7853 trillion won in sales and 662.1 billion won in operating loss in the third quarter
Sales were KRW 630 billion lower than market estimates, and operating loss was KRW 90 billion higher.
Large OLED shipments expected to be 5 million units this year… 25% decrease from last year
LG Display’s large organic light emitting diode (OLED) (Data = LG Display)
LG Display announced third quarter earnings that were significantly below market estimates.
LG Display announced on the 25th that it recorded sales of 4.7853 trillion won and operating loss of 662.1 billion won in the third quarter. Compared to the same period last year, sales decreased by 29.3%, and operating loss decreased by 97 billion won. This is the 6th consecutive quarter of operating loss.
Both sales and operating profit in the third quarter fell below market consensus. Sales (4.7853 trillion won) were 630 billion won lower than the market consensus (5.4178 trillion won), and operating loss (662.1 billion won operating loss) was more than 90 billion won greater than the market consensus (570.3 billion won operating loss).
The second quarter promise that the third quarter operating loss (662.1 billion won operating loss) would be smaller than the second quarter (881.5 billion won operating loss) was kept. Sales increased by 1% compared to the previous quarter.
Regarding sales in the third quarter, LG Display said, “Demand from upstream industries differed by product group and recorded a similar level to the previous quarter.” Regarding profit and loss, he explained, “We reduced the loss compared to the previous quarter and the same period last year through accelerated business structure advancement and intensive cost reduction activities.” TV panel shipment area remained at the previous quarter’s level, and the peak season effect for IT product panels was reduced due to the delayed recovery of demand in the B2B market.
LG Display said that although there were some setbacks in the production of small and medium-sized organic light emitting diodes (OLEDs) for smartphones in the third quarter, it would complete the process without a hitch in the fourth quarter. When asked, “Please tell us regarding the delay in smartphone panel supply in the second half of the year and the resulting impact,” LG Display responded, “It is true that there were some other types of setbacks related to production, as market perception suggests, but we overcame them well.” He added, “We have overcome our production capacity in the fourth quarter.” “We have expanded our capacity, and we will make the best use of this to complete the delayed parts without a hitch,” he said.
This year’s large OLED shipment forecast is 5 million units. This is a 25% decrease from last year’s shipment of 6.8 million units, and is lower than this year’s global OLED TV shipment forecast of mid-5 million units. LG Display said, “Competition is intensifying due to the recent expansion of ultra-large liquid crystal display (LCD) sales, especially in the Chinese market, and as inventory adjustments by sets and distributors continue, this year’s annual (OLED) panel shipments are 500% lower than set shipments.” “We expect it to be around 10,000 units,” he said.
The promise to turn a profit in the fourth quarter was also announced in this quarter’s earnings announcement. LG Display said, “It is still valid that we expect to turn a profit in the fourth quarter and will work towards our goal,” and added, “We focused on activities such as cost innovation in a bad market environment, and when the market situation improves, our activities so far are positive.” “I hope it will work.”
The Elec = Reporter Lee Ki-jong [email protected]
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