LG isn’t going out on top, but it is going out after falling from third from the top. After years in the business, LG smartphones will no longer be on the shelf, as the company announced it was ending its mobile business.
Do you have an LG smartphone sitting next to you right now? It’s now a relic. It probably seemed like a safe choice when you bought it, but LG is throwing in the towel.
LG Electronics Inc. from South Korea, despite earlier having the No. 3 smartphone brand, has always taken a loss with its mobile business. It tried to find a buyer for that leg of the brand, but when it failed to do so, it decided to just end it.
Despite having been the third most popular smartphone, LG smartphones were only ever able to grab 10 percent of the North American market when at the top of their game. This is because the company was stuck behind Apple and Samsung.
Ko Eui-young, an analyst with Hi Investment & Securities, said, “In the United States, LG has targeted mid-priced – if not ultra-low – models, and that means Samsung, which has more mid-priced product lines than Apple, will be better able to attract LG users.”
LG smartphone business brought in about $4.5 billion. By leaving that behind, it allows the company to focus on its other products, such as electrical components for electric vehicles, connected devices, and smart home products.
LG’s smartphone business initially did well, peaking in 2013. but later, it slipped and no longer curried favor after issues with hardware and software. Lesser brands have suffered hardship as well – such as Nokia, HTC, and Blackberry – but they are all still around. Blackberry even made a return to the market. In Latin America, the LG smartphone did well as the No. 5 brand.
Currently, LG only has about 2 percent of the smartphone market. Last year it shipped out 2 3 million units, but Samsung shipped out more than I0 times that amount with 256 million, according to Counterpoint. The company’s smartphone business only accounted for about 7 percent of revenue.
LG expects to fully end its run by July 31. Employees will be moved to other areas of the company. It plans to hold onto its 4G and SG patents and have its research and development team work on 6G. It is still unsure what it will do with its intelligence.
Current customers should not despair – at least not yet. LG plans to provide support for software updates for a time. The exact time will depend on region.
Interested in brand loyalty? Read how some users of Android brands have migrated to Apple over the past few years.
Image Credit: LG Newsroom