South Korea’s LG Electronics on Monday said the business is shutting its cellular business unit after nearly six decades of losses totaling $4.5 billion. The transfer makes it the first significant smartphone manufacturer to withdraw from the industry.
LG said the cell phone company will end up by July 31, even though the inventory of some existing models may still be the available post that.
“LG’s Strategic decision to depart the exceptionally competitive mobile phone business will enable the company to concentrate resources in growth regions like electric vehicle components, linked devices, smart houses, robotics, artificial intelligence, and business-to-business solutions, in addition to platforms and services,” the company said in a statement. LG will continue to leverage its own mobile expertise and create mobility-related technology like 6G to assist further strengthen competitiveness in other business areas, it added.
For existing mobile customers, LG will provide service support and software upgrades for a time period, varying by area. The business noted that details associated with the employee will be determined at the local level.
The announcement has put an end to speculations around the future of LG’s smartphone company after the firm said earlier this year that it would evaluate the smartphone business. LG’s exit would introduce a chance to Apple and Samsung to gain more customers, particularly in the US where LG’s market share was 9 percent in December 2020, based on Counterpoint Research.