LG Electronics Exits Smartphone Market in 2021 After Years of Financial Losses

On 05/04/2021, South Korean technology manufacturer LG Electronics officially announced its decision to withdraw from the global smartphone manufacturing business, ending more than two decades of mobile phone development and sales. The decision was approved by the company's board of directors in Seoul, South Korea, following prolonged financial losses in its mobile communications division. LG stated that withdrawing from the highly competitive smartphone sector would allow it to redirect resources toward growth areas including electric vehicle components, connected devices, smart homes, robotics, artificial intelligence, and business-to-business technology solutions. The announcement followed several years of declining performance in LG's smartphone operations. The company's Mobile Communications division had recorded operating losses for 23 consecutive quarters by the end of 2020. Its cumulative losses over approximately six years were estimated at around 5 trillion South Korean won, equivalent to roughly US$4.5 billion at the time. LG faced competition from leading smartphone manufacturers including Samsung Electronics and Apple, as well as Chinese brands such as Xiaomi, Oppo, and Vivo. These competitors placed pressure on LG across both premium and mid-range smartphone categories. LG had been involved in mobile phone manufacturing since the 1990s and developed several notable products during its participation in the industry. In 2006, the company introduced the LG Chocolate, a mobile phone recognized for its minimalist design and touch-sensitive controls. The LG Prada, announced in 2007, featured a capacitive touchscreen interface before the widespread adoption of modern touchscreen smartphones. LG later introduced Android devices such as the Optimus G in 2012, the LG G2 in 2013, and the LG G3 in 2014, incorporating technologies including high-resolution displays, optical image stabilization, and rear-mounted physical controls.