November 25, 2024

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LG Electronics' logo (Yonhap)

LG Electronics is expected to record its highest revenue ever of 84 trillion won ($64 billion) in 2023, backed by solid performance in its core businesses, including automotive products, and effective management, the company's preliminary earnings showed on Monday.

Despite challenges posed by delayed demand recovery from the economic slowdown and heightened market competition, LG Electronics marked its third consecutive year of achieving the highest annual revenue, the tech giant said.

The tech giant's annual sales figure appears to have increased by 1 percent when compared to the previous year. Annual operating profit is estimated to have edged down by 0.1 percent to post 3.5 trillion won.

The company attributed its record revenue in 2023 to strong performance in its core businesses as well as growth in its B2B sectors.

"Strategic efforts to enhance the business portfolio, including the early identification of market turning points to drive high growth in B2B sectors, played a pivotal role," the company said in a press release.

"Business model innovation, such as diversifying from hardware-oriented businesses to platform-based service business, also contributed to maintaining stable profitability."

According to the company, the compound annual growth rate of its revenue over the last three years stands at over 13 percent.

In the home appliance and air solution business, LG said it expects to have achieved an annual revenue milestone of 30 trillion won. Strategic market approaches, such as expanding volume zone lineups while retaining leadership in the premium product sector played a key role in the sales boost, successfully addressing the polarization in demand, the company said.

In addition to concentrating efforts to strengthen product and manufacturing competitiveness, the company said it will also accelerate efforts to bolster its smart home solutions, upholding its vision for a "Zero Labor Home."

The vehicle component solutions business is anticipated to have exceeded 10 trillion in annual revenue, becoming one of LG's core businesses since its establishment a decade ago.

According to the company, the average operating rate of production facilities has surpassed 100 percent since last year. Starting this year, LG said it will focus its capabilities for software-defined vehicles on enhanced in-vehicle experiences, and seek growth in terms of volume.

Despite challenges in key markets like Europe, the home entertainment business experienced meaningful growth in its webOS content and services, LG said.

"This year, the expansion of the webOS ecosystem will extend beyond TVs to encompass smart monitors, in-vehicle infotainment and other areas, further broadening the business scope," the company said.

LG also said it will significantly strengthen both its top-tier OLED lineup and its QNED lineup, following a dual-track strategy to lead the premium market.

The business solutions company is concentrating on the early commercialization of key areas such as EV charging and robotics, LG added.

The confirmed earnings report for 2023 is scheduled for release later this month.

By Jo He-rim (herim@heraldcorp.com)