LG Mobile had a "challenging" second quarter, weak flagship sales to blame


Have you noticed how the LG G6 seems to be on sale pretty much constantly? As of writing, it can be bought for under $500 from Best Buy, Amazon and B&H, while its suggested retail price is a solid $200 more. And we've seen much deeper discounts in the past, too — so what gives? Sure, we doubt any customer will be complaining for a good savings, but when a company keeps their flagship at a near-constant 25 percent off , it sure doesn't inspire much confidence in its market performance.

But don't just trust our opinion on the matter: LG Electronics has just posted its Q2 2017 financial results, and according to them its mobile division saw a "challenging" second quarter with an operating loss of KRW 132.4 billion (USD 117.27 million). The primary reasons LG gives for this are higher component costs and — get this — weaker than expected premium smartphone sales.

But it seems that the U.S. is warming up on the company's smartphones, as proven by a 13 percent increase in year over year device sales in the country. Then again, those numbers didn't come from flagship devices, either: LG cites "strong performance of the company’s mass-tier lineup," where "mass-tier" actually means low-end. This is also a good explanation for the newly-introduced Q series — LG clearly states it expects to see increased sales in the second half of the year following the Q6 and Q8's release.

Still, while its mobile division is underperforming, the rest of LG Electronics is actually doing quite well — the home appliances division leads the pack with a sales increase of 12 percent over last year, while the operating income for the entire company (LG Mobile included) actually jumped 13.1 percent.

The report did make sure to mention the upcoming launch of the LG V30, even if it did so with little enthusiasm. We don't imagine it will do much to fill the mobile division's financial hole, though, considering the G6's unimpressive performance and some LG's questionable decision to actually start pulling out of countries. Here's hoping the company proves us wrong, though.

source: LG (1, 2)

Related phones

G6
  • Display 5.7" 1440 x 2880 pixels
  • Camera 13 MP / 5 MP front
  • Processor Qualcomm Snapdragon 821, Quad-core, 2350 MHz
  • Storage 32 GB + microSDXC
  • Battery 3300 mAh(20.5h talk time)

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29 Comments

1. AhmadAlsayegh

Posts: 326; Member since: Jul 18, 2011

wanting to be the first to release their flagship hit their sales, the flagships that were released shortly after the G6 were higher performance, and better overall...but samsung is partly to blame for screwing up the supply of the SD835

2. IT-Engineer

Posts: 535; Member since: Feb 26, 2015

Some of it is true, but they are missing one critical thing that Samsung does best: Spending loads of money on adds world wide, here in Scandinavia, No matter whar film you wanna watch in any Cinema, they start by putting S8 adds.

4. AhmadAlsayegh

Posts: 326; Member since: Jul 18, 2011

I totally agree with you, it is a serious of unfortunate events, rather than specific reasons contributing to this issue

20. sgodsell

Posts: 7218; Member since: Mar 16, 2013

The LG G6 has a lot going for it. Like the large bezel less design which everyone is going to. A QHD+ display with 2:1 resolution display, Wireless charging, quick charging, MIL-STD-810G with ip68 water proofing. The problem with LG is they left out some things that initially attracked people to them. Ir blaster, removable battery. Those things made them different, and I love the universal remote being built into my phone's. What does that cost to add back in? A buck or 2. Plus LCD displays have had their run, and are going to be dead in the near future. LCD is slower for refresh rates compared to OLED. It's why the G6 is not Daydream compatible. Yet Samsungs S8 is now Daydream compatible. Look even Apple is going with Samsung's OLED displays. LG's V30 is said to have an OLED display and be Daydream compatible as well. I just wish LG puts back the IR blaster as well.

14. Canaan

Posts: 351; Member since: May 25, 2014

I don't think that was the only issue. LG flagships have been plagued with Bootloop problems since the G4 and they did nothing to address the issue until this year.

3. trojan_horse

Posts: 5868; Member since: May 06, 2016

"Still, while its mobile division is underperforming, the rest of LG Electronics is actually doing quite well — the home appliances division leads the pack with a sales increase of 12 percent over last year, while the operating income for the entire company (LG Mobile included) actually jumped 13.1 percent." Yay, that's the perk of being diverse in tech, and not being too reliant on a single division.

5. kevin97

Posts: 90; Member since: Mar 01, 2016

LG never knew where to make the compromises in its phones. Take the G6: they used last-year camera sensors with small pixel size, they removed the notification LED (bye-bye business users), and they didn't bother to find a better placement solution for the fingerprint sensor. Not to mention the older, power-hungry chipset which cancelled the battery size increase. If LG wants good sales, they must work their a**es off: find ways place the fingerprint sensor in front or on the power button, bring back the ultra useful notification LED, find ways to truly increase battery size and battery life, use a single great camera instead of two mediocre cameras, further reduce top and bottom bezels.

22. sgodsell

Posts: 7218; Member since: Mar 16, 2013

Clearly you are making crap up. The G6 has new cameras in the rear. The G5 had a 16 MP camera and a wide angle 8 MP camera. The G6 has two 13 MP cameras this year with one camera wide angle. As far as the finger print scanner is concerned. The placement is in the middle of the phone below the cameras. It's a great placement, especially when you pull it out of your pocket, because it's already unlocked before you bring it up to your face. Then you bring up another lie, in regards to the older power hungry chipset. I guess the Pixels, and other smartphones using the SD 821 are all power hungry. Not! Especially when that SoC can sustain a QHD at 60 fps with VR. Something the iPhone 7 cannot even do, it would overheat and throttle down if it tried. One of the reasons why Apple themselves don't support VR, along with their slow GPU, which even Apple themselves are dropping. The part where you said further reduce the top and bottom bezels made me laugh. The G6 is less than a 1/2" taller than an iPhone 7. Yet it has a 5.7" QHD+ display compared to the smaller iPhone 7 4.7" HD display. The G6 is pushing more than 4 times the number of pixels compared to an iPhone 7. Thanks kevin97 for showing the world how ignorant and misinformed you really are.

23. Lumberjack

Posts: 306; Member since: May 04, 2017

The sensor of G6 is imx258. Same used by Xperia XA 2016. Also front cam of X, X Perf, XZ, XZs and XZ Premium. It has 13MP, size of 1/3.05" , pixel size of 1.12

6. foreverNOOB

Posts: 158; Member since: Jul 07, 2017

They're keep doing something wrong again and again... They're put so much resources into new technologies like modular thing and ticker but almost no visible advertisement anywhere...also choosing to rush out a phone without latest spec but failed to launched it as soon as they can...and don't forget that market specific things... I think that V30 will be their last chance, its must have everything imaginable to compete with giant range from design, best raw spec, great camera, lastest software, battery life, no market specific feature, great screen, great audio capability, etc. So wishing them well.

7. 314NTMD

Posts: 13; Member since: Jul 28, 2016

still sells better than HTC, which deserves MUCH more attention and sales with U11 SAD :(

8. redmd

Posts: 1926; Member since: Oct 26, 2011

They are to blame themselves. It's 2nd half 2017 still no SD 835 phone from them. Tsk Tsk Tsk

9. Spyro

Posts: 334; Member since: Mar 29, 2017

Blame their marketing division. Here in my country, there are a lot of Samsung and Apple advertisements going around.

10. ibend

Posts: 6747; Member since: Sep 30, 2014

pre-2016 => bootloop fail 2016 => modular fail 2017 => rushed fail.. No SD835, wireless charger only for some market, dual DAC also only for some market, mediocre battery life, no OLED screen..

11. foreverNOOB

Posts: 158; Member since: Jul 07, 2017

They're using QuadDAC not dualDAC...

12. surethom

Posts: 1665; Member since: Mar 04, 2009

LG deserves to loose money on the LG G6, for not giving us the same phone in each country. UK only gets the low 32gb version not the 64gb & wireless charging only in USA. So it's LG s fault.

13. piyath

Posts: 2445; Member since: Mar 23, 2012

What LG needs at this moment is Apple's money and partnership. Just like Samsung, LG will also rise again with the Apple money and blessings....lol

15. lallolu

Posts: 732; Member since: Sep 18, 2012

They could have made money on the LG V20 which is a very good phone with ok battery life. But they decided not to release it in Europe.

16. limona

Posts: 72; Member since: May 19, 2017

A lot of bad decisions... I like the brand and I believe they will recover.

17. zr2s10

Posts: 45; Member since: Jul 07, 2017

In addition to lack of advertising, they need to push to get their phones more prominent in stores. In any stores that do carry it, they're rarely easy to find! On top of that, if you go to Wal-mart or Sam's Club to look for phones, you see: iPhones, Galaxies, and an LG.....X Power. Seriously. Go look, I'll wait. Back? See, told you. Why the F do they carry cheap crap LG's, but not the G6 or V20? Even if people don't buy at Wal-mart, it's serious advertising when you're looking for phone. I use my wife as an example of "the general public", since she's very tech-averse... She knows exactly what an iPhone is (duh), and knows that the newest Galaxy is the S8. I mentioned wanting to buy a G6, and she just had a blank stare, followed by, "Like, the car? We're talking about phones, and you don't need another car." So obviously, LG has done almost no advertising.

18. jove39

Posts: 2145; Member since: Oct 18, 2011

LGshould get rid of UI layover and star using stock android.

19. zr2s10

Posts: 45; Member since: Jul 07, 2017

They're building the next Pixel, right? lol

21. hazard1

Posts: 234; Member since: Feb 11, 2017

Most responses above have touched on the reasons why LG cannot gain traction. Good phones, yes. But: 1) past bootloop issues were a problem (apparently addressed to be fair); 2) poor advertizing/marketing; 3) bad decisions (little things like no LED which bugged me to not so little things like the modular cluster f* that was the G5 to releasing so many variants and crippling releases (no quad DAC and limited storage outside Asia? Really?); 4) what I call the "almost" factor. there is always something. The G3 had a suboptimal processor. the G6 had the SD821 instead of the 835. The G4 had to go with the SD808 because of the 810 issues that year. The G5 finally went premium, only to feel cheap somehow because of the finish. For all that, I loved the G2 to the G4 and had no problems with them. But LG has a habit of shooting themselves in the foot.

24. ryq24

Posts: 875; Member since: Oct 17, 2011

The G6 is a good phone. But Samsung S8 is just more popular.

25. PHYCLOPSH

Posts: 652; Member since: Jun 28, 2014

LG is to blame for what they are experiencing now. The G5 itself wasn't an awful product, but its delivery was a failure and the GPS issue was unacceptable. Had they released useful modules that you could actually buy (perhaps an expanded battery?) I can guarantee it would've sold better. The G6 was a rushed idea altogether in a feeble attempt to make up for the G5 disaster. It did away with many features that set LG apart from the competition (the removable battery and IR blaster for instance). Couple that with the fact they removed the notification light and downgraded the main cameras image sensor and its arguably a worse product than the G5 in fact. Suck it up LG - and for Christ sake pull your heads out of your @$$, because if you f*** up again on the G7, I can guarantee that your flagship division has seen its last dance.

26. fyah_king unregistered

I'm enjoying my G6.:)

27. ChazzMatt

Posts: 104; Member since: Sep 26, 2013

The reason the LG G6 didn't sell is easy. LG crippled it with their stupid "regional" spec scheme. * Want quad DAC? Hopefully you live in certain Asian countries. * Want more than 32GB internal storage? Out of luck if you live in the U.S. or Europe. * Want Qi wireless charging? Better move to the U.S.! I want Qi wireless charging, but I also want better audio and MORE internal storage! The LG G6 ON PAPER was a fantastic phone. Problem was, they cut that piece of paper into several parts and shipped those parts to separate countries. Idiots. Only with the LG G6 Plus -- which came out MONTHS later -- did they combine all hardware specs into ONE phone. But by then, Snapdragon 835 was the norm and "last year" Snapdragon 820 by then is laughable. So, even the LG G6 Plus was too little, too late. PUT ALL THE SPECS INTO ONE PHONE and sell it to the world.

28. PHYCLOPSH

Posts: 652; Member since: Jun 28, 2014

To be honest, LG would've been better off letting Gary Busey direct their G6 commercials than the bum who created the sh**ty unimaginative ads they briefly aired on TV. https://www.youtube.com/watch?v=44zKaqKaYdM

29. dane723

Posts: 6; Member since: Mar 17, 2012

G6 SD821 is ok. I like the design, build, fingerprint sensor than S8. Like a tank. I like the most is the wide angled cameras both front & rear and likeable software. But 32GB internal storage, without Quad DAC, 5MP front cam is so so, battery. Other places getting 64GB, Quad DAC, wireless charging. It should be same specs worldwide.

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