LG may close its smartphone business as its accumulated losses have crossed $4.43 billion

Lately, we have been hearing that LG Electronics might sell off its smartphone business, besides certain rumours saying that the company is might launch its rollable smartphone. And now it’s getting quite certain that the company may shut down its smartphone business.

We also heard a while ago that LG is selling its shares to VinGroup. But then it was told that the deal went off due to a high asking price.

If this stands correct, it means that we aren’t going to see any smartphone coming out from LG.

While LG hasn’t been performing well in its smartphone business and was making losses, the CEO of the company, Kwon Bong-seok said:

Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice. The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business.

It’s no hidden truth that the Vietnamese company Vingroup JSC has been showing a strong interest in acquiring LG’s smartphone business. The group has businesses in various domains, including hotels, tourism, real estate, construction, automobiles, and smartphones, and has a market value of above $10 billion.

Whereas LG’s smartphone business has been making losses for the past 23 quarters (since Q2 of 2015). As of Q4 of 2020, the business had a loss of around $4.43 billion. Which led the company to think of all possible ways to reduce its losses, and the best option, witnessing from far sight, is to sell its smartphone unit to the Vingroup JSC.

It’s to be noted that there was a tie when LG became the world’s third-largest smartphone manufacturer.

Source: GizChina