LG Display has moved into the black and its first operating profit for some time having reported 7 previous quarters of losses.
LG said it could report an operating profit of 164.4 billion WOn (€122.6 million), on the back of its heavy expense control efforts, increased OLED sales and price increases in its LCDs. Revenues for Q3 grew by 27 per cent to $5.94 billion.
The South Korean technology giant said that as more people work and study from home due to the pandemic, it could also see strong demand for displays used in IT devices. As to the volume of glass shipped LG Display delivered 8.3 million square metres, up 23 per cent q-o-q.
LG Display said its revenue share of the market was 28 per cent, up 5 percentage points q-o-q, and helped by extra output from its Guangzhou fabrication plant. As to the upcoming year the company said their output would grow to 7-8 million units in 2021 and thus responding to market demand for “ultra-large sizes of 77” or bigger”. The company also said that production for sizes up to 48” (increasingly from gamers) would also be increased.
As part of its cost-cutting efforts, LG Display planned to cease producing LCD TV panels in its Paju plant by the end of 2020. But due to the strong demand for its LCD panels, it has decided to flexibly respond to the changing market situation, transforming some of its LCD production lines to display panels for other devices.
LG Display had struggled with falling profitability in its LCD business in recent years after being hit by the industry’s oversupply in conventional LCDs as lower-cost Chinese rivals have flooded the market. To remedy these challenges LG has moved aggressively into OLED production with higher margins.
Though the mass production schedule in the China factory took longer than expected, LG Display now supplies 19 TV makers that use its OLED panels and industry analysts suggested the company will see increasing demand for the high-priced panels.