South Korean flat-screen manufacturer LG Display Co Ltd announced its second straight quarterly loss and reduced its investment budget. This was because of rising inflation and a bleak economic outlook.
Due to the Russia-Ukraine war and the energy crisis, tech gadget manufacturers drastically reduced their inventory, and consumer attitude in Europe, a crucial market for organic light-emitting diode (OLED) TV sales, swiftly deteriorated. As reported by the company, there was a significant reduction in net profit in the third quarter of 2022 compared to previous quarters of 2022 and 2021. However, there was a significant increase in total revenue in the third quarter of 2022 compared to the previous quarters of 2021 and 2022.
To better meet demand, LG Display Co. Ltd. intends to operate its OLED manufacturing lines flexibly and reduce its 2022 investment budget by more than 1 trillion won. For some panels, the slow demand for liquid crystal display (LCD) and OLED panels—which hindered shipments during the third quarter—is anticipated to last through the second half of next year.
Thanks to adjustments in panel makers' output in October, the price of LCD panels stabilized, although LG Display is anticipated to continue losing money in the current quarter due to lackluster demand.
Since the second quarter, when it reported its first quarterly operating loss in two years as a pandemic-driven demand surge for home entertainment devices abruptly ended amid mounting inflation and interest rates, LG Display has been losing money.
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