LG confirmed that this year is going to be the end of the road for the company. It was announced after the board of directors approved the decision. It will now shift its focus and resources in the fields of electric vehicle components, IoT devices, smart homes, robotics, AI and business-to-business solutions.
LG will continue its R&D efforts in the field of communication networks including its projects on 6G and will focus on strengthening its competitiveness in other fields. There’s also confirmation that all core LG technologies developed in the past two decades will be retained and put into future products from the brand.
After losing around $4.5 billion over the past five years, it was getting difficult to stay afloat for the company. LG CEO Kwon Bong-Seok has notified employees about the company’s decision regarding the discontinuation of the smartphone business.
Kwon Bong-Seok sent out an internal memo to staff on Wednesday, hinting at a change in direction for LG’s phone business. “Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice,” says an LG official in a statement. “The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business.”
LG has previously through “wow factors” tried to attract consumers and make its flagging mobile division profitable. LG came up with innovative smartphone multiple times such as the G7, the V40, the G8, and the V50 to compete with Samsung and Huawei, but it’s not been enough to push its market share in the right direction. LG’s latest Velvet and Wing smartphones have attempted to try something new, but neither was well received.
Samsung, Huawei, Xiaomi, Vivo, and Apple all continue to dominate worldwide smartphone shipments, according to IDC. LG is now turning its focus to its Rollable phone, to differentiate it from the competition. LG teased the Rollable device again at the Consumer Electronics Show last week, with a “unique resizable screen” that extends from a phone to become a small tablet display.
The decision of leaving the smartphone business was not a surprise for LG since it didn’t have the scale of Samsung and lacked a big hit. The company said that it will focus on electric vehicle components, smart homes, robotics, AI, and business-to-business hardware.