South Korea’s LG Show reported its highest quarterly revenue in over three years on Wednesday, returning to the black for a second quarter in a row with assist from elevated shipments of Apple’s new iPhone fashions.
The Apple provider posted an working revenue of KRW 685 billion (roughly Rs. 4,500 crores) within the 2020 fourth quarter, in contrast with a lack of KRW 422 billion (roughly Rs. 2,800 crores) in the identical interval a 12 months earlier.
It was the show panel agency’s highest quarterly revenue for the reason that second quarter of 2017, and soundly forward of market expectations for a KRW 286 billion (roughly Rs. 1,900 crores) revenue, in accordance with a Refinitiv SmartEstimate derived from 12 analyst estimates.
“As the global work-from-home situation continued in the fourth quarter, demand for TV and IT products remained strong,” LG Show mentioned in a press release.
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Shipments and costs of natural light-emitting diode (OLED) panels rose for each TVs and smartphones, whereas the robust earnings had been helped by full-scale manufacturing at its Guangzhou OLED plant, the corporate mentioned.
Analysts highlighted elevated shipments of OLED panels for Apple’s new iPhone 12 and better costs for liquid-crystal show (LCD) panels. LCD costs rose on the again of rising demand for TVs from international shoppers caught at dwelling as a result of COVID-19 pandemic.
Apple’s iPhone shipments within the fourth quarter had been doubtless up 21 p.c on-year as a result of robust efficiency of the iPhone 12, in accordance with Counterpoint knowledge.
Stronger iPhone gross sales ought to spill over into LG Show’s first quarter end result, analysts mentioned.
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“The first half of the year is usually a seasonal down-cycle, but this year is different. It will continue to swing to profit, as iPhone 12 sales are expected to increase panel shipments by 1.5 to two times the amount a year earlier,” mentioned Kim Kwang-jin, an analyst at Yuanta Securities Korea.
LCD panel costs must also stay excessive within the first quarter, he mentioned.
An influence outage in Nippon Electrical Glass’ (NEG) Japan-based glass manufacturing facility in December could have an effect on LG Show’s first-quarter shipments, as about 80 p.c of its glass got here from NEG within the first half of 2020, analysts mentioned.
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However the decrease provide of large-sized glass might additional raise panel costs within the first quarter, offsetting the impression of any fall in shipments, they added.
Income rose 16 p.c to KRW 7.5 trillion (roughly Rs. 49,500 crores), LG Show mentioned in a regulatory submitting. Its shares fell 0.6 p.c by 01:16 GMT (6:46am IST) in contrast with a 0.9 p.c rise within the wider market, which analysts put all the way down to profit-taking.
© Thomson Reuters 2021
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