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LG Display Q1 profit jumps 338% despite revenue dip
Quarter-on-quarter, revenue and operating profit both declined, while EBITDA reached 1.1 trillion won (US$776 million).
OLED products made up 60% of revenue, up 5 percentage points from a year earlier.
🔗 Source: Chosun Daily
🧠 Food for thought
Implications, context, and why it matters.
LG Display’s profit came from moving away from large liquid crystal display (LCD) panels to OLED
- Improved profit, despite lower revenue, followed the company’s exit from large liquid crystal display (LCD) panels, including the sale of its plant in Guangzhou, China 1.
- Leaving that lower-margin business freed cash for more small and mid-sized organic light-emitting diode (OLED) production 1.
- The shift also needed heavy funding, including a 1 trillion won (US$680 million) loan from sister company LG Electronics, LG Group’s consumer electronics affiliate, to “raise the competitiveness of organic light-emitting diode (OLED) and secure operating funds” 1.
Apple’s search for a second OLED supplier helped make LG Display an iPhone screen source
- LG Display’s mobile OLED work fits Apple’s effort to add another supplier and rely less on Samsung Electronics for iPhone OLED screens 2.
- The relationship began with orders of about 2 million to 4 million OLED displays for iPhones 3.
- Apple later invested US$2.7 billion in LG Display to make OLED panels for its 2018 iPhones 4.
- Adding LG Display gave Apple more room in price talks and lowered supply-chain risk, which could help steady future device costs 2.
