As we have been expecting for a few weeks now, LG has officially announced that it is withdrawing from the smartphone market. The South Korean company says this is a strategic decision, and can now allocate the resources it has invested in the smartphone division to other areas such as connected devices, electric vehicle components, smart home devices, robotics, AI and business solutions. Of course, the decision was made after years in which LG smartphones were not profitable.
The LG smartphone division was unprofitable
According to the financial results that LG publishes every quarter, its smartphone division has been unprofitable for six consecutive years. During this period, this part of the business lost $ 4.5 billion. Most likely, in order to make a profit again, the company would have had to completely restructure the division and continue to lose a few more years until new competitive products reached the market.
The official date when LG withdraws from the smartphone market is July 31, and in the meantime, the company will try to liquidate its mobile phone stocks. The company also says that the fate of the employees of these divisions will be decided locally. Some will probably be able to move to other divisions, while others will lose their jobs.
What about software updates
Also, software updates for already released devices will not disappear immediately, and services will continue to repair devices that are still under warranty. However, LG also promised clearer information depending on the region. Models for which Android 11 has been confirmed will receive updates, while some models may even receive Android 12. The company says it will continue to deliver security updates in the near future. However, LG says plans can change at any time. Phones that are still in production will not be released, as expected.
However, the company remains dedicated to developing technology for mobile devices. LG promises to continue working on new solutions, such as the upcoming 6G technology, to enable it to consolidate other parts of its business.
Robert J. Smith is still early into his career as tech reporter but has already had his work published in many major publications including JoyStiq and Android Authority. In regards to academics, Robert earned a degree in business from Fordham University. Robert has passion for emerging technology and covers upcoming products and breakthroughs in science and tech.