LG made only 1.2 cents in operating profit for each phone it shipped last quarter
posted by Alan F. / Jul 29, 2015, 10:34 AM
But the most incredible number is the 1.2 cents in operating profit that LG made per phone shipped. LG blames the results on weak sales of premium phones. Smartphone and tablet sales showed strong growth in North America, but sales in its own backyard of South Korea were weak. LG can usually count on strong domestic sales of its high-end phones.
The company also is spending huge amounts of money to market its latest flagship model, the LG G4. But the device is having a tough time competing with other Android phones like the Samsung Galaxy S6 and Samsung Galaxy S6 edge.
The results drew a mocking tweet from Carl Pei, co-founder and CEO of OnePlus. Pei sarcastically congratulated LG for earning less per phone than OnePlus made during the quarter. OnePlus, of course, is known for selling highly spec'd flagship quality phones at a value price. On Monday, the company introduced its high-end OnePlus 2 with the 64GB model priced at $399.99.
source: ABC, @getpeid via BGR
- Display 5.5" 1440 x 2560 pixels
- Camera 16 MP / 8 MP front
- Processor Qualcomm Snapdragon 808, Hexa-core, 1800 MHz
- Storage 32 GB + microSDXC
- Battery 3000 mAh(18.5h talk time)
Posts: 764; Member since: Nov 05, 2013
Where in the report does it say the mobile division earned 200m WON?
posted on Jul 29, 2015, 10:38 AM 0
Posts: 279; Member since: Apr 18, 2015
LG is a sinking ship.
posted on Jul 29, 2015, 10:39 AM 1
Posts: 833; Member since: Jun 23, 2012
you are dreaming man. when you say LG its represents LG Electronics. not only the Smartphones. by the way LG smartphone is not sinking too its just did not meet the expection for this second quarter of 2015. and infact LG total number of sold phones/smartphones is increasing every year....and we are just on the 2nd quarter of the year there are two more quarters....3rd and 4th
posted on Jul 30, 2015, 12:11 PM 0
Posts: 6474; Member since: Jan 28, 2013
Eh. All smartphone margins are super low. Which makes it more aggregious that Apple gets away with the largest profit margins in any industry ever, not just mobile. What is possible an even bigger crime is that they get praised for having Greta customer service and warranty even though the yards don't realize that they are actually paying for this service and warranty that is pretty much just added into their profit margins. Yes Samsung and LG phones aren't exactly cheap either, but they have way more overhead than other companies. They have special factories and employees just for the curved displays. All their profits basically go back into their R & D and their manufacturing plants. All of Apples profits go straight into their bank accounts.
posted on Jul 29, 2015, 10:40 AM 9
Posts: 4; Member since: Nov 27, 2014
Exactly. Companies like LG and Samsung put almost all of their profits into R&D, marketing, paying executives and stuff. They don't want to keep a large profit because that means you have to pay taxes on that profit. They rather pay taxes on 2 cents than pay taxes on $1000. I don't want to attack Apple, but I bet the tax evasion issue has something to do with their profits. I don't follow Apple news so I don't know if the issue has been resolved or not.
posted on Jul 29, 2015, 7:56 PM 0
Posts: 1442; Member since: Nov 19, 2012
g4 is too big. 5,5'' is too big to be the only alternative. Either you do like samsung and apple (i.e. a flagship that is not much bigger than 5'' like the gs6/iphone6 and a phablet like the note series and iphone6+) or you do like sony, where you sell a big flagship and its compact version (z3/z3c). But relying only on one flagship which is so big means you're cutting out most smartphone users who don't want such a big phone. Motorola will face the same problems with the new moto x.
posted on Jul 29, 2015, 10:46 AM 2
They sold 10 million G3's. Samsung has sold well over 40 million note series phones so far. The fact that the g4 is bombing doesn't have much to do with size, the numbers just don't bear that out. But it does have everything to do with stiff competition and a saturated market.
posted on Jul 29, 2015, 6:39 PM 0
Posts: 41; Member since: Dec 20, 2013
I love my G4, but the price kinds of killed it. Last year, the G3 was priced lower than other flagships in the Netherlands. I know 4 people with the G3 and they bought it all because of the price. Now, the G4 is as expensive as the other flagships. I think people tend to choose an Apple or Samsung device if it is the same price. Maybe that is one of the reasons for the lower profit.
posted on Jul 29, 2015, 10:52 AM 1
Posts: 981; Member since: Jul 07, 2014
Price? Look again at how cheap it is (belsimpel etc)
posted on Jul 29, 2015, 11:38 AM 0
Posts: 2187; Member since: Nov 04, 2011
Android manufacturer's are part of a bubble that has burst. Manufacturer's all throwing into the Android experience, but are losing money as a result of a saturated market. I find it funny that market share doesn't always equal success and long term growth. I have preached that for at least 5 years now.
posted on Jul 29, 2015, 10:54 AM 1
Posts: 2968; Member since: Jun 19, 2012
Incoming BobbyBuster comment: "nobody makes money on Android"...
posted on Jul 29, 2015, 10:55 AM 8
Posts: 1285; Member since: Dec 30, 2014
Everybody makes money on Android.
posted on Jul 29, 2015, 11:01 AM 2
The issue is that all phones are becoming too alike regardless of the user interface skins. I miss seeing weird shaped phones that had mechanisms and hinges.
posted on Jul 29, 2015, 11:04 AM 0
Posts: 1774; Member since: Jul 30, 2013
Function over form. Having a phone in weird retarded shape like half old Nokia's were is just bad. You want a phone that works well all the time and is easy to use. Not a piece of sculpture that has 0 functionality and is ruining your experience. You are not looking at your phone from a distance you are using it. And using a piece of crap with hinges in a weird shape ruins the experience.
posted on Jul 29, 2015, 11:52 AM 0
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