LG Electronics Inc. (LG) has released its preliminary earnings for the fourth quarter and full year of 2025, reporting record-breaking annual revenue despite a year-on-year decline in operating profit.
The South Korean technology group posted consolidated revenue of KRW 89.2 trillion for 2025, with operating profit of KRW 2.48 trillion. The results mark the second consecutive year of record revenue for LG, with consolidated sales growing at a compound annual growth rate of around 9 per cent over the past five years.
While revenue continued to expand, profitability came under pressure. LG said operating profit declined due to a slower-than-anticipated recovery in display-related demand and intensifying competition, which drove up marketing costs. The company also booked one-off restructuring expenses in the second half of the year, linked to voluntary retirement programmes introduced as part of a wider workforce optimisation effort. LG said these measures are expected to lower fixed costs over the medium to long term.
At the same time, LG’s so-called “qualitative growth” businesses increased their contribution to overall performance. These include B2B operations such as vehicle solutions and heating, ventilation and air conditioning (HVAC), non-hardware segments such as webOS and product-based services, as well as direct-to-consumer models including home appliance subscriptions and online sales. Collectively, these businesses accounted for nearly half of LG’s total revenue in 2025.
Looking ahead, LG said it will continue to strengthen these growth engines as it shifts towards a more profitability-focused growth structure. Although U.S. tariff pressures are expected to persist into 2026, the company said it had mitigated much of the impact in 2025 through improved manufacturing utilisation, and operational efficiency and plans to maintain these measures next year.
LG’s home appliance business is expected to deliver its highest-ever annual revenue in 2025. The division maintained its leadership in the premium segment while achieving stable performance in volume-driven markets. Growth was further supported by the continued expansion of the home appliance subscription model. In 2026, LG plans to boost growth by increasing investment in B2B areas, including built-in appliances and core components such as motors and compressors.
By contrast, LG’s display-based businesses, covering TV, IT and information display, are expected to record an annual operating loss. Weak demand and heightened competition led to increased marketing expenditure, weighing on profitability. However, the company’s webOS platform business continued to grow at a double-digit rate, supported by a global installed base of around 260 million devices. LG said it will further strengthen webOS by expanding premium content partnerships, enhancing services and broadening its lifestyle TV range, with a particular focus on high-growth emerging markets.
The vehicle solutions business delivered record revenue and operating profit in 2025, driven by the ongoing premiumisation of in-vehicle infotainment systems and continued improvements in operational efficiency. LG said it plans to sustain growth in 2026 on the back of a strong order backlog while accelerating the development of software-defined vehicle technologies towards AI-defined vehicles, positioning itself as a key partner in next-generation mobility.
LG’s HVAC business also continued to expand as a core B2B growth pillar. The company is moving beyond residential systems into commercial and industrial solutions, supported by growth in maintenance and service operations and an expanding global manufacturing footprint. Drawing on cooling technologies ranging from air-based to liquid cooling, LG is also targeting long-term opportunities in AI data centre cooling.
For the fourth quarter of 2025, LG reported consolidated revenue of KRW 23.85 trillion and an operating loss of KRW 109.4 billion. The company said the figures are tentative consolidated earnings prepared under K-IFRS and are provided for investor reference ahead of its final earnings announcement, which will include net profit and detailed divisional results later this month.
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