SEOUL (Reuters) – LG Display Co Ltd (034220.KS), a South Korean Apple Inc (AAPL.O) supplier, reported on Thursday its fifth straight quarter of operating losses, hit by slumping demand for smartphones and televisions due to the coronavirus pandemic.
FILE PHOTO: A man walks out of the headquarters of LG Display in Seoul, October 20, 2011. REUTERS/Jo Yong-Hak/File Photo
The operating loss for the first quarter ended March widened to 362 billion won ($294.70 million) from a loss of 132 billion won a year earlier, and compares with a Refinitiv SmartEstimate drawn from 19 analysts for a 390 billion won loss.
LG Display’s revenue fell 20% to 4.7 trillion won.
“We expect volatility in demand to increase down the road, as industry sectors are impacted by the COVID-19 outbreak. The difficult situation will inevitably linger, although it is expected that demand in IT products will grow due to stay-at-home orders and consequent surge in online activities,” LG said in a statement.
Analysts say although liquid crystal display (LCD) panel prices in the industry rose when production was disrupted in China at the peak of the coronavirus outbreak there, the price increases were shortlived as Chinese rivals had resumed production, contributing to a supply glut in the market.
Prices for LG Display’s main product, 50-inch LCDs for television sets, rose a bit more than 1% in the quarter from the previous quarter, according to data from WitsView, part of research provider TrendForce.
In an effort to stem losses, LG Display has said it will halt domestic production of LCD TV panels by the end of this year.
Samsung Display, a unit of Samsung Electronics Co Ltd (005930.KS), said last month it will end all production of LCD panels by the end of this year.
The results were released after the South Korean stock market closed on Thursday. LG Display’s share price has fallen more than 33% this year to date, compared with a 12% fall in the benchmark index .KS11.
($1 = 1,228.3600 won)
Reporting by Heekyong Yang and Hyunjoo Jin; Editing by Muralikumar Anantharaman