updated 09:10 am EDT, Tue April 21, 2009
LG Q1 2009 Results
LG on Tuesday reported results for the first quarter of 2009 that reflected a phone business that have at least temporarily dropped year over year. The Korean firm's cellphone division generated a profit of $187 million between January and March but sold 7 percent fewer phones than it did a year earlier, sinking to 22.6 million units. The reduction is an unusual drop for the company and is blamed on both the typical post-holiday drop as well as the world economic crunch.
The company doesn't fully break down how devices sold but notes that its best sales were for the Cookie entry touchscreen phone, which sold 2 million in 5 months, and the KS360, which is known as the Neon for AT&T but has been a relatively strong seller in areas where it has already been on sale, such as Canada and Europe. LG says its sales were best in the "mid-tier" and infers that its phone sales were weakest at the high end.
The drop comes in the face of a $148.5 million loss for the company as a whole, but also as the company expects to bounce back this spring. It believes that its phone numbers dropped at a gentler rate than the rest of the market, which it puts at about a 10 percent decline, and ultimately expects sales to go up 10 percent versus the winter based on its 2009 touchscreen phones, particularly iPhone rivals like the Arena and Viewty Smart. The Arena in particular is poised to be one of LG's fastest-selling phones ever and managed 2 million sales in a month.
LG's performance is also significantly better than some of its immediate rivals, many of whom were hit severely by the economic slump and had few or no strong-selling phone lines. Nokia's sales dropped 19 percent year-over-year and were largely saved by the 5800 XpressMusic, while Sony Ericsson plunged 35 percent with only the Windows Mobile-based XPERIA X1 standing out.