LG Electronics Surpasses 22 Trillion Won in Q1 Sales for the First Time... Subscription and HVAC Growth

Operating Profit Down 5.7% to 1.2 Trillion Won...
Surpasses 1 Trillion Won for Six Consecutive Years
Core B2B HVAC Business Expected to Exceed Last Year's First-Quarter Performance

LG Electronics' first-quarter sales exceeded 22 trillion won for the first time, driven by growth in subscription and heating, ventilation, and air conditioning (HVAC) businesses.

LG Electronics announced on the 7th that its consolidated operating profit for the first quarter of this year was preliminarily estimated at 1.259 trillion won, down 5.7% from the same period last year. However, thanks to a solid profit structure, the first-quarter operating profit surpassed 1 trillion won for the sixth consecutive year. Stabilization of raw material and logistics costs, as well as securing flexibility in global production operations, also contributed to profitability.

LG Electronics CEO Jo Joo-wan is explaining management performance and mid-to-long-term business strategy directions to shareholders at the 23rd regular general meeting of shareholders held at LG Twin Towers in Yeouido, Seoul on the 25th of last month. Photo by Yonhap News

First-quarter sales reached 22.7447 trillion won, up 7.8% compared to the same period last year. This is the first time that first-quarter sales have exceeded 22 trillion won. Despite ongoing uncertainties in the business environment such as economic recession, LG Electronics explained that stable growth in existing core businesses, along with 'qualitative growth' areas represented by business-to-business (B2B), subscription, webOS, non-hardware (Non-HW), and direct-to-consumer (D2C) sectors, led to the company's highest-ever sales.

Although detailed results by business division were not disclosed on this day, it is interpreted that the HS Business Division (formerly H&A Business Division), which handles home appliances, maintained dominance in the premium market with its core products, and the built-in home appliance business and external sales of parts such as motors and compressors, which belong to the B2B sector, also contributed to strong performance. The subscription business, which combines products and services, is also rapidly expanding its achievements.

The HVAC business, which is being nurtured as a core B2B business, is expected to surpass the performance of the same period last year (sales of 2.589 trillion won, operating profit of 335.6 billion won) in the first quarter of this year. LG Electronics previously established the ES Business Division, responsible for the HVAC business, as a separate business division at the end of last year. LG Electronics explained, "We are focusing capabilities as an independent business division tailored to the nature of the order-based HVAC business and customer characteristics, thereby increasing profitability." In the commercial air conditioning system sector, they are achieving large-scale orders in places like Singapore by leveraging locally specialized solutions based on climate, architectural methods, and residential patterns.

LG Electronics plans to further accelerate growth this year by strengthening its subscription-suitable lineup and enhancing care services. It also plans to expand overseas entry into the subscription business. The media entertainment business will integrate display-based businesses such as TVs, laptops, monitors, and commercial displays starting this year, aiming to create synergy in the webOS-based advertising and content business, which was previously TV-centered. Recently, they launched the 2025 TV lineup with significantly enhanced AI features to target the market.

In the air conditioning business, the industrial and power sectors such as AI data centers are accelerating the securing of business opportunities using ultra-large cooling chillers, while the home HVAC business plans to maintain leadership by introducing AI new products. The automotive electronics business will continue growth by expanding sales of high value-added products centered on in-vehicle infotainment (IVI) and diversifying business models through vehicle content platforms and others.