Stable Supply of Camera Modules Despite Seasonal Off-Peak
"Strengthening Cost Competitiveness, Advancing Business Portfolio"
LG Innotek achieved its highest-ever first-quarter sales this year, driven by the stable supply of high value-added products. However, profitability declined due to intensified market competition in the optical business and other factors.
On April 23, LG Innotek announced that its consolidated sales for the first quarter of this year were provisionally tallied at 4.9828 trillion won, up 15% from the same period last year. Despite the seasonal off-peak period, the company achieved record-high first-quarter sales thanks to the stable supply of high-end camera modules and a recovery in demand for substrate materials used in semiconductors and displays.
Operating profit was 125.1 billion won, down 28.9% from the same period last year. This decline is attributed to a slowdown in the growth of downstream industries such as electric vehicles, as well as intensified market competition in the optical business. Net profit fell by 38.2% to 85.6 billion won.
By business segment, the Optical Solution Business recorded sales of 4.1384 trillion won, an 18% increase year-on-year, thanks to the stable supply of high-end camera modules for smartphones. The Substrate Materials Business achieved sales of 376.9 billion won, up 15%, as demand recovered for semiconductor substrates such as RF-SiP (Radio Frequency System in Package) and display substrate products such as COF (Chip on Film).
In contrast, due to the slowdown in the growth of downstream industries such as electric vehicles, sales in the Automotive Components Business reached 467.5 billion won, a 5% decrease compared to the same period last year. LG Innotek explained that sales of high value-added products such as in-vehicle communication and lighting modules are gradually increasing. The company plans to improve profitability by enhancing cost competitiveness through development focused on platform models and internalizing key materials and components.
Park Jihwan, Chief Financial Officer (CFO, Executive Vice President) of LG Innotek, stated, "We are driving our core mobility components business, including AI and semiconductor parts led by Flip Chip Ball Grid Array (FC-BGA) and automotive AP modules, as well as vehicle sensing, communication, and lighting. At the same time, we are advancing our business portfolio by strengthening cooperation with leading companies in the robotics sector."
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