LG said on Monday that it would shut down its loss-making mobile phone business worldwide as the once leading brand looks to focus its resources in “growth areas” such as electric vehicle components, connected devices, Smart Homes, Robotics, AI and B2B Solutions, and Platforms and Services.
The South Korean firm said in a statement that its board of directors approved the decision today. After the company’s statement since January, when it was reviewing the direction of its smartphone business, it was a shocking move.
LG, which for a long time held the No. 3 spot in the smartphone market in the US, said it would continue to sell handsets until the inventory was in place, and would provide software support for the current lineup of smartphones for a fixed period of time, changing by region. Huh.
The company said that the status of its employees of the phone business would be determined locally. In January, reports surfaced that stated that LG wants to sell its smartphone business. In the same month, the company said that it would launch a rollable phone this year. But it seems that all attempts to maintain the business failed.
“Going forward, LG will continue to leverage its mobile expertise and help develop mobility-related technologies such as 6G to further strengthen competition in other business areas. The core technologies developed during two decades of LG’s mobile business operations will also be retained and applied to existing and future products.
The poor financial performance of LG’s smartphone business has been publicly known for many years. Like countless other Android smartphone vendors, LG has struggled to turn things around.
LG focused on mid-range and high-end smartphones, two segments of the market that have become increasingly competitive over the past decade thanks to the rise of Chinese phonemakers such as Huawei, Xiaomi, OnePlus, Oppo and Vivo Have become increasingly competitive that are launching better value- models for money every few months. (Once a rival, HTC is struggling, too.)
Many phonemakers today rely heavily on software services such as mobile payments to make money. While LG launched a mobile payment service two years after Samsung launched Samsung Pay in 2017, LG’s portfolio of services remained slim throughout the year.