LG Display: LCD Market Hits Bottom, But We Will Recover
Despite the gloomy news, CEO Kwon Young-soo told reporters that he expects the LCD industry to bounce back.
"The good news is that we've reached a bottom," said Kwon. "TV panel prices will likely stop the downward trend and recover."
Kwon said his optimism is based on what he sees as healthy consumer demand for cheaper and smaller LCD sets.
"Consumers are finding a flat-screen TV is worth the money if they were ever to spend on electronics goods rather than, say, home appliances," Kwon said.
The No. 2 LCD producer is not, however, placing all its eggs in the flat-panel display basket. The company said it is investing $427 million using LTPS (low temperature polysilicon) to ramp up its production of LCD screens for mobile devices.
"Smartphones are expected to account for 30 percent of all handsets in 2011," said Kwon. "We need the LTPS technology to cement our [position] in the smartphone market, which is expected to grow rapidly."
LG's quarterly loss also included a $400 million fine imposed by the U.S. Department of Justice in November related to price fixing.
The Seoul, Korea-based company reported a fourth-quarter loss of 684 billion won ($504 million U.S.), compared with a profit of 760 billion won in the same period a year ago.
LG did report some good news last week when it announced a five-year, $500 million deal with longtime partner Apple to provide it with LCD panels. According to Park Sang-hyun, an analyst at HI Investment & Securities, LG panels already represent more than 70 percent of Apple's notebooks and monitors.