Driven by revenue growth across all business segments, LG Innotek surpassed 6 trillion won in revenue for the first time on a third-quarter basis, but operating profit was cut in half due to the sharp decline in the won-dollar exchange rate. Revenue exceeded market expectations, while operating profit fell significantly below the consensus estimate (the average of securities firms' forecasts).
LG Innotek disclosed on the 27th that its preliminary Q3 results showed revenue of 6.3671 trillion won, up 18.6% year-on-year, and operating profit of 94.8 billion won, down 53.4%. Revenue and operating profit for the same period last year were 5.3694 trillion won and 203.7 billion won, respectively.
The securities industry had forecast LG Innotek's Q3 revenue and operating profit at 6.097 trillion won and 197.3 billion won, respectively. Actual revenue exceeded the consensus estimate by 270.1 billion won (4.4%), but operating profit fell short by 102.5 billion won (52.0%).
By business segment, Optical Solutions recorded revenue of 5.4041 trillion won, up 20.6% year-on-year. Package Solutions increased by 10.1% to 481.8 billion won, while Mobility Solutions rose by 6.8% to 481.1 billion won, driven by results from new businesses such as automotive communication modules and lighting, AP (application processor) modules, and digital keys.
LG Innotek plans to focus on enhancing profitability through the upgrading of its business portfolio centered on high-margin, high-value-added products, as well as physical AI businesses such as autonomous driving and robotics. Package Solutions will pursue expansion of its FC-BGA (Flip Chip Ball Grid Array) production plant to gradually enter the AI (artificial intelligence) accelerator and server markets by 2028, while Optical Solutions aims to maximize cost competitiveness through process automation and in-house component production.
An LG Innotek official explained, "With the start of Yangsan for customers' new models, supply of mobile camera modules increased, and steady growth in demand for high-value-added semiconductor substrates such as RF-SiP (Radio Frequency System-in-Package), FC-CSP (Flip Chip Chip Scale Package), and FC-BGA contributed to revenue expansion." The official added, "Operating profit decreased year-on-year due to the sharp drop in the won-dollar exchange rate between the timing of raw material procurement and product Yangsan shipments."
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