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LG posts Q3 2015 financial report, shows a staggering loss of $68 million on mobile

LG's mobile division made a staggering loss of $68 million in the last three months, according to figures released in the company's financial report for Q3 2015. It's a blow to the division at the popular manufacturer who brought in profit of just $172,000 back in in Q2.

Despite a 12 percent sales increase in North America, worldwide performance for the division stumped with sales decreasing by 7% quarter-over-quarter and by 21% year-over-year. The company expects competition to remain fierce with the launch of new hardware from other companies, but does plan to improve profitability by increasing sales with the launch of V10 and Nexus 5X.

While the handset side of LG's business looks to be in a spot of bother, the company performed well overall. LG posted a profit of $109 million, taking into account increased sales of electronics in other areas of the company.

Source: LG, LG (PDF) (opens in new tab)

  • This on the heels of Samsung's 3Q15 income report....I guess removable batteries and expandable storage really aren't that important. Posted via the Android Central App using my Note 5
  • That has nothing to do with it. When a person enters a carrier store you buy the phone that's familiar to you, not if it has a removable battery or the SoC being used they walk up to it and say "ehh the Samsung phone is more familiar and the software is better. Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • ^ What he said I love my G4, but let's face it. Samsung did bring about lots of great stuff this year. The new Hamilton Beach SD toaster. Powered by the Snapdragon 810.
  • To be fair, you're both saying the same thing. He's saying that removable batteries and expandable storage aren't that important, and  you're saying that familiarity is more important than removable batteries. Both essentially the same thing.  
  • I think what he's trying to say is that even though removable batteries and SD card slots aren't that important, they're not the reason why LG's results weren't good.
  • Nailed it Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • It's still the same thing. LG's results weren't good for reasons *other* than batteries and SD card slots. Which is the same as removable batteries and expandable storage not being important, as they aren't important enough to overcome familiarity and software.  
  • OK OK Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Nailed it. Posted via the Android Central App on my Nexus 7
  • It is what it is. LG mobile hardware is very good thier UI is meh, but to be fair about 90% of mobile makers UI are meh. But to be fair Samsung is the big kid on the block, and it's going to remain the big kid on the block. They Samsung where one of the first mobile phone makers that caught fire. Because when I do use my LG g3 the phone noobs ( for lack of a better term) all ways ask what Samsung phone is that. But Samsung does make good devices there's no denying that but yeah the battery and the SD card really matter to the phone enthusiast everyday people givea a rats ass about that Posted via the Android Central App
  • Would love just once or once a year these two companies sammy and LG released a Vanilla android phone with top of the line specs or close to it for all carries and just see what happens. These companies could save a lot of money just using vanilla android and make all their features into apps. And not worrying about their own version of an android UI.
  • HA! Absolutely, those features are important to a shockingly tiny percentage of phone buyers. Posted via the Android Central App
  • yep the majority don't care as long as they csn type well, use Facebook, instagram and play a couple games. most people could care less about the battery and as card, hell . I don't even think most my friends have movies in their phone. LG Imo just sucks, especially thst g3 and g4 and now that v10 will suffer the same fate. Posted via the Android Central App
  • Lg is another HTC... let's face it Posted via Nexus 6 "NeRd"
  • Uhhh, LG has lots of other divisions to help them make money if their smartphones don't sell all that well. HTC doesn't.
  • Ya such as refrigerators, lighting,and dishwashers. Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Yep, just like Samsung, only Samsung is way bigger. Also, you do realize that LG is actually a carrier in South Korea, right? I didn't know until very recently.
  • It's a lot bigger than you thought (white goods). There are 5 divisions: Home Entertainment, Mobile Communications, Home Appliance, Air Conditioning and Energy Solution, and Vehicle Components.
  • LG also makes displays and some more stuff, even chemicals. And like I mentioned, in their home country, they are a mobile carrier, named "U+".
  • I don't know about others. At least for me, if not for the battery and sd slot, I wouldn't by my LG G4 upon S6
  • If they keep making devices bigger it won't help.
    I'm certain a true Compact version of the G4 would sell far far better the V10 will.
    Just look at which devices sell better in companies that offer normal sized devices.
    Apple - 6/6S instead of the Plus.
    Sony - Z3Compact instead of regular Z3 (too soon to say anything about the Z5 but likely to follow suit). LG should at least try. Posted via the Android Central App
  • Samsung note 5 and Galaxy s6 plus are both sellijg extremely well. Especially the note 5, and that's a big of a phone as any. I don't think it's really the size.
  • But are they selling better or worse than the smaller more normal phone sized S6?
  • Two things: 1 - They can sell well but are they selling more or less than their smaller versions S6 and S6Edge? You don't know. 2 - And you will continue not knowing that for the time for the time being given that the Note 5 isn't even available in key-markets like Europe. However, even based on the S6 and S6 Edge alone, the S6 Edge sells better than the S6 (much to Samsung's surprise). Funny enough...the S6Edge is SMALLER than the S6 at 142cm vs 143cm. Not a BIG difference BUT still a difference, once again, in favour of the smaller version).
  • How do you know the Z3 Compact sold more than the normal Z3? Posted via the Android Central App
  • I don't think Sony releases sales figures on the Z series? Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Retailer reports.
  • That's bullshit
  • Go ask Clove, for example. Go ask retailers across Europe. Google it.
  • I think this is due to several factors. It's the combination of tougher competition (especially from Samsung), the rise of cheaper unlocked devices that offer the performance and specs of $600+ devices without the price and the fact that the G4, as brilliant as it is, really isn't much different from the G3. My friends who have the LG G3 said that they liked the G4 but wouldn't upgrade because the changes were too minimal to justify it. The LG V10 is very compelling, but really, what LG should do is continue to make excellent phones but try not to be too incremental about them. Also, they should see if they can put their devices at a lower price-point to boost sales and make them more attractive. One more thing is that LG should improve their marketing efforts. Samsung's decision to seal up their batteries and remove the expandable storage option this year is a good opportunity for LG to heavily capitalize on the fact that their 2015 phones have both. But there wasn't much effort done in that, nor in the entire marketing department. The marketing part is crucial, because my friends still think that LG "has disappeared from the face of the earth" as far as their phones are concerned. I know some folks are inevitably gonna compare LG to HTC or Sony, but the truth is, HTC and Sony have been struggling for years. Both continue to make a loss and their future is uncertain. While LG can somehow be compared to Sony in the sense that they have other divisions to help the entire company make money should their smartphone division falter, HTC does not have anything to fall back to if their smartphone division falters.
  • Absolutely. I don't normally like "attack ads", but a good series pointing out what LG phones can do that Samsung ones can't would be the best thing for them right now. Make it funny and people won't mind as much. LG is one of the only major manufacturers who have removable storage and battery, they need to capitalize on that. Make themselves the "alternative" brand for people who like choice and flexibility as opposed to "fashion" which seems to be all Samsung cares about anymore.
  • ^ Exactly LG could position themselves as the de facto alternative to Samsung through clever marketing.
  • Lol just like Samsung did years ago, positioning itself as the defacto alternative to the iPhone. LG really needs to do this!
  • That's a great point, actually. All those "Samsung vs. iPhone" ads that were aired in the US some time ago (especially in the GS3 and GS4 days) really helped push Samsung in the US market and basically made their brand presence much stronger. LG could try the same. The risk is high, but the reward is worth the risk if it's successful.
  • Or even when Samsung had the "Wall hugger" commercials last year where it talked about the other phones bad battery and how Samsung battery us long and could be changed out. Those where pretty big commercials
  • I was told by everyone around here that it makes them look pathetic and desperate. I guess that beats sad and lonely. +++ Insert witty signature, watch as others not get it, profit +++
  • It might, but you can't deny that for Samsung, it worked really well.
  • Android makes money they say. Lol. Posted via the Android Central App
  • Who's they? Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • " they" could be the Illuminati, aliens or hamsters. But those are all guesses I have no clue. What they is referring to Posted via the Android Central App
  • They don't want you to know +++ Insert witty signature, watch as others not get it, profit +++
  • I'm spooked Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • You let me know when ANY OS makes money just by existing without any device attached, will you? 'cause that'll be the day! Since, you know, so far, Windows needs devices to run on, Android needs devices to run on and iOS only lives because it's what's running on the iPhone and Apple makes the money on the overpriced hardware they manage to sell through sheer brand-power.
    You can make money with Android long as you offer COMPELLING devices sold above production and operating costs that people may really want to buy. Here's a hint: Android One, cheap Android devices etc are NOT that sort of devices. Flagships that always fall short on something as we've been seeing year after year from ALL brands, are NOT those devices. And so, no one feels compelled to burn 700€ every year for an Android phone. With OEMs constantly putting out Android phones without real compelling stuff, few people will switch phones yearly. It's important to remember that tech-geeks like most of us here are NOT AT ALL representative of the consumer market. We may switch phones just because one has a newer processor or more RAM. The average consumer doesn't give a rats arse about that. And Android OEMs have been basing their strategies on mere spec bumps without truly innovative features. And even when they put out innovation - like the Edge displays on the Galaxies - OEMs never go the full way in making sure that they take the most out of those innovations. Like Samsung didn't do. And I bet Sony won't do with their 4K display on the Z5P.
    But I bet you that in a couple of years, Apple will be stealing those "innovations". And people will once again think they came up with them because if there's something Apple deserves credit for is taking time to perfect the software that goes along their "innovative" hardware. Again, just look at their "3D display". It's nothing really new. But Apple did something with it and paired it with proper software. And now "boom" it's the latest fad.
  • I'm sure the V10 will just fly off the shelves too. Posted via the Android Central App
  • Maybe if it was priced a bit lower and more people know about it. Otherwise, it's just gonna sell in decent but not outstanding numbers.
  • I'm somewhat interested in the V10, but mainly because it's newer than the G4 and I can get it easily and cheaply through T-Mobile jump on demand. I hate to say it, but I think I might be even more interested in it if it had a SD 810. When the G4 launched, the SD 808 was seen as a premium chip. But since then it seems that the 808 is being positioned as almost a second tier chip. In my opinion the inclusion of the 808 on the V10 really makes the V10 feel like it isn't much of an upgrade.
  • I think LG wanted to avoid the SD810's poor reputation. It performed poorly in their Flex 2, so they probably knew that putting it in their more "normal" devices wouldn't be worth it.
  • Wow! makes you wonder how long these losing companies can afford to pay mountains of cash for the privilege of making Google ad devices. Posted via the Android Central App
  • I think this might be one situation where marketing dollars makes the difference. If you go to Best Buy, Samsung has its own area of the store that's very large and brightly lit to catch people's attention. They have several demo units out for people to test, and I noticed that they were always occupied with someone checking them out. In contrast LG had a small kiosk off to the side for the G4 that no one was paying attention to. T-mobile stores are similar: Samsung usually has its own table front and center right by the entrance so that the Note 5 and Gs6 are the first phones you see when you walk in the door. Meanwhile the G4 is just another phone on the wall.
  • Yeah, every time I go to best buy I play around on the Samsung section, it's basically the only way I get hands on on a new device from them. Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Exactly. Samsung has a much stronger brand presence in many countries. In many countries that I travel to, LG phones are typically sold in small sections in a phone store while Samsung ones either have their own section that takes up a significant part of the store or have their own store.
  • What countries do you travel to if ya don't mind me asking? Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Here's a list. Japan
    Hong Kong
    Taiwan I might have missed a few, but I'm going to Europe in the future. It's also the perfect opportunity to see how well my G4 fares.
  • I hate you so damn much right now. Nothing personal... +++ Insert witty signature, watch as others not get it, profit +++
  • You really need to explore the world someday. Just sayin'. :P
  • Year after year I look at the mobile divisions of LG, Sony, HTC, and more than trying to pinpoint bulletpoint factors as to why they're failing, Im just wondering about the pertinence of their existence, considering their positioning. Im not downplaying the importance of competition, and they do put out good phones, but either the marketing of just brand perception is just not there. And they dont seem to be able to change that, while other brands are on the rise. Obviously, Im not speaking for the audience on this website, we're all more or less up to date with whats going on, but around me it's just about Apple, Samsung, and growing/curious interest in up and coming Chinese brands (Mainly Huawei, and to some extent ZTE and Xiaomi), or even Asus or Alcatel that are capable of manufacturing quality units at affordable prices (Where I live, more and more phones are sold naked, without a packaged contract).
  • While this is interesting, it should be recognized that in a division the size of LG Mobile, $68 million is pretty much just a rounding error. I think you also have to consider that LG is in the stage of development where they are trying to steal market share from entrenched competitors (Samsung, Apple), and in that phase of business development the emphasis tends to be on innovation, quality and figuring out the most profitable market segments for the long term (or better, creating products that create new segments), with only a secondary focus on immediate profitability. This a path that fledgling Japanese car and electronics companies successfully pioneered in the 70s and 80s -- and if successful and LG's market share goals are ultimately achieved, then the focus down the road becomes cost reduction, greater efficiency and then increasing profits. That's not to say that LG won't be in financial trouble in 5 years, but if that happens it won't be because of a $68 million loss in Q3 2015. It will because they failed to win long-term share of the market, and I don't think that should be an obvious worry right now. Consider where LG was in mobile 5 years ago and where they are now.
  • Great point. I hope that this also pushes them to make even better devices. LG seems to be a fan favorite in AC. I love my G4.
  • Too bad the 5x is a dud.
  • As of the current software state, this is true Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Yeah very sad. We are sending our back today and getting another hoping it is hardware that is the issue +++ Insert witty signature, watch as others not get it, profit +++
  • Have you tried disabling encryption?
  • Is that an option? It isn't on my Neuxs 6. It is the one issue I have with this phone. Posted via the Android Central App
  • If disabling encryption caused a massive performance boost, then somethings probably up with the code base because this was fixed in 5.1. Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • From what I've heard, compared to the 6P, the 5X isn't as fast as it should be.
  • After seeing the 5x and 6p performance side by side it just ruins the 5x for you. And ppl Are saying "oh well It's a lower end phone". A snapdragon 808 isn't low end and this definitely isn't excusable performance for 2015. However, I do think it will get fixed. Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • I'm suspecting it's bad optimization on both Google and LG's part. An SD808 shouldn't be so slow. It runs well on both the G4 (well, the H815 G4) and Moto XPE.
  • I orders a 6p and my friend ordered a 5x. He has already had to ship it back and get another 5x already due to dust on the camera sensor. It's not a good start honestly. Posted via the Android Central App
  • I can't begin to say how many times I've swapped my G4 battery for the one I keep fully charged at all times in the charger.
    Having swappable batteries and a charger is great! Posted via the Android Central App
  • My LG g pad sucks!!!!! Posted via the Android Central App
  • Another thing is that LG could consider doing it like Samsung and add a separate brand to their phones. Like how Samsung calls their Android-powered phones "GALAXY" and how Sony calls them "XPERIA"? LG did try with "OPTIMUS" back then, but I think they should really try again as "LG" isn't really a strong force in terms of branding in the smartphone market. Also, they should consider making LG UX lighter. I mean, I have no issue with LG UX on my G4, but it does look ugly and frankly, making it lighter is gonna bring lots of benefits anyway.
  • I'm shocked. I thought that all the people who were outraged about Samsung's decision to seal the phone shut were going to hop on LG's removable battery/sd card bandwagon. Note 5/Edge+/AC App
  • I did. :P I think it's more of the fact that removable batteries/SD cards aren't a big factor in smartphone decisions or that Samsung and Apple's brand power are just too strong.
  • I can sum this up. Dear LG, it's your UI
  • way better than....samhad..oh phones Posted via Android Central App
  • If you say so... lol Posted via the Android Central App
  • I've always had good luck with LG products and I think they generally represent a good value. From a Nexus 4, to my current G2, a G Watch, and countless flip phones back in the day, I think they make nice things. The problem, I think, is multifaceted for their mobile division. First, their UI/UX needs a major overhaul. It just isn't fresh, modern, and quick. And in many ways, they are simply trying to copy Samsung, instead of offering a unique experience. Second, they haven't done much in years to bolster its brand identity in mobile. They just hang out there offering Samsung-esque devices every year, and that's not good enough, because most consumers aren't going to buy the copy when they can buy the real thing (Samsung). Third, they need a truly premium flagship. They have been known for making plastic fantastic for a while, and the leather option on the G4 is different, but they need to go further. Make a real premium device, that can better compete visually with the S6 and iphones out there. I'd honestly hate to see LG ultimately disappear from mobile one day, so whatever they choose, I hope they get it sorted out.
  • Lol. And people questioned me when I said that HTC and LG were in a race to the bottom. It's only going to get worse with that flop of a V10 LG is releasing smh.... Posted via the Android Central App
  • It's more like Sony and HTC are racing to the bottom. You can say LG is racing to the bottom if they continue to make a loss.
  • Glut, alot, whatever... Phones are all over the place now. Why buy when you don't need it... Posted via Android Central App
  • Hope the Nexus 5X helps them a bit. I've always liked my LG phones, even the old feature phone I still have lying around as an extra. It'd be sad if they pulled out of the smartphone market. Posted via the Android Central App
  • Mind boggling that the company that brought out the best phones of the year posted a loss
  • What's mind boggling is how you can think LG came out with the best phones this year. Posted via the Android Central App
  • The majority of people you all will tell you there are two phones on the market a "Galaxy" and an iPhone. Posted via the MATERIAL AC App
  • Several lg G4 phones with touch screen issues ruined if for me and I came from the G2 and G3. Nexus 6p is pending! Posted via the Android Central App
  • LG needs to reinvent themselves and they need to act fast before is too late. I think getting rid of their useless skin is a good start. Have your phone run pure stock Android just like Motorola. Stop entering phablet territory. I mean they don't even have a stylus. Make a smaller device with biffy specs. There's a great demand for that. Maybe stop using weird ugly leather covers, and so much plastic. And maybe focus on more premium built just like Samsung did, it's clearly working for them. Posted via the Android Central App
  • You do know LG doesn't only make phones right??? Posted from my Nexus 6/Nexus 7 2013/Surface Pro 3
  • Yep but this is an Android site and until LG decides to use Android on their Appliances I'll give you an opinion about it too. Posted via the Android Central App
  • Well, every cloud has a silver lining. In LG's case, their TV division posted a profit for the first time in 3 quarters. The new Hamilton Beach SD toaster. Powered by the Snapdragon 810.
  • They're slowly moving towards a premium build. Pretty sure that LG knows what they're doing after this rather disappointing quarter. I agree that their skin is not good, but I think they should lighten it up considerably (like Sony) instead of getting rid of it since there's some useful features like QSlide.
  • I like LG products, good value for money. Own LG TV and LG Smartphone (Flex 2) and i am very satisfied. Miracast and it's Infrared Remote Control are working perfectly. They dance very well together. Will buy the Nexus 5X also ,stunning design. Posted via the Android Central App
  • My house has an LG webOS TV along with a G3 + G4. Frankly, my family has a preference on LG over Samsung, but to me, they're equally good, though I prefer LG's OLED TVs over Samsung's SUHD TVs.
  • Samsung is a behemoth compared to LG, they have so much more $$ for R&D, advertising, and bigger distribution channels, and phone carrier support "just like Apple", most of these phone carriers pretty much push phones from these two "Apple and Samsung" companies, everyone else is just an afterthought. Posted via the Android Central App
  • I love my G4 but BlackBerry learnt that Apple will very hard to break their marketing is the reason why the lead the market not the quality of their products Apple cannot do no wrong
    But to each their own a smartphone for me is a tool not a toy if I wanted a toy I would buy a IPhone Posted via the Android Central App
  • I'm worried that too many companies are simply going to leave the market of Android devices. HTC, Sony and now LG are all having problems making money in their mobile department and I'm worried they won't be in the mobile space in the coming years. Sony Xperia Z2
    Nvidia Shield
    Xperia Z3 Tablet Compact