Operating Profit Surpasses 1 Trillion Won for Six Consecutive Years in Q1
Vehicle Components and HVAC Operating Profit Up 37%
Home Appliances Respond to Market Uncertainty
with Production Site Optimization and More
LG Electronics achieved its highest-ever quarterly sales, driven by its vehicle component solutions and heating, ventilation, and air conditioning (HVAC) businesses, which are considered future growth engines and the core of its business-to-business (B2B) operations.
On April 24, LG Electronics announced in a regulatory filing that its consolidated operating profit for the first quarter of this year was 1.2591 trillion won, a 5.7% decrease compared to the same period last year.
Although this figure was 5.4% below the market consensus of 1.3315 trillion won, the company maintained a robust profit structure, recording first-quarter operating profit exceeding 1 trillion won for the sixth consecutive year. Revenue reached 22.7398 trillion won, a 7.8% increase year-on-year, marking the highest first-quarter sales in the company's history. Net profit was 875.6 billion won, up 49.6%.
The company explained that these results were driven by "qualitative growth" in areas such as B2B business, subscription services, webOS and other non-hardware (Non-HW) businesses, and direct-to-consumer (D2C) sales.
In particular, both the VS Business Division, responsible for vehicle components, and the ES Business Division, responsible for HVAC, achieved record-high quarterly sales and operating profit. The VS Business Division posted first-quarter sales of 2.8432 trillion won and operating profit of 125.1 billion won. Growth was supported by a backlog of orders worth nearly 100 trillion won, and profitability improved as the share of premium products in the in-vehicle infotainment (IVI) business increased. For the ES Business Division, first-quarter sales were 3.0544 trillion won, up 18.0% year-on-year, and operating profit was 406.7 billion won, up 21.2%. The operating margin was 13.3%.
The combined operating profit of these two divisions increased by 37.2% compared to the same period last year. Sales growth also reached 12.3%. The HS Business Division, which serves as the company's main business and cash cow, recorded first-quarter sales of 6.6968 trillion won, up 9.3% year-on-year, achieving its highest-ever sales as it accelerated changes in business models and methods such as subscription and D2C. Operating profit increased by 9.9% to 644.6 billion won.
The outlook for the second quarter remains uncertain as changes in global trade policies become more pronounced. For its home appliance business, LG Electronics plans to maintain growth by expanding its lineup of new models and volume zone products in response to market changes, and by accelerating its subscription and online businesses.
The company intends to focus its capabilities on B2B areas such as built-in appliances and the external sales of key components like motors and compressors, while also striving to secure solid profitability by improving cost competitiveness through optimized production site operations. For the vehicle component business, the plan is to ensure a stable profit structure by expanding sales of high value-added products, optimizing operations in the electric vehicle parts business, and enhancing resource management efficiency. The ES Business Division, a key pillar of B2B growth, will focus on expanding sales of new home products and securing commercial air conditioner orders in emerging markets. The company also aims to drive large-scale order opportunities, such as those for AI data centers, by leveraging its ultra-large chiller products.
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