Why LG Stopped Making Smartphones

LG’s exit from the global smartphone market in 2021, driven by six consecutive years of mobile division losses totaling approximately 4,5 miliar dollar AS according to Reuters reports, highlights the severe challenges brands face when competing against dominant industry players like Apple and Samsung. Once a major innovator credited with pioneering the capacitive touchscreen via the LG Prada and shipping over 10 juta unit of the LG G3, the South Korean technology company saw its global smartphone market share dwindle to roughly 2 percent by 2020.

The Market Pressures Behind LG’s Exit

Intense competition across all price tiers squeezed LG out of the profitable mobile sector. The company faced dominant forces in the premium and mid-range segments from Apple and Samsung, while low-cost, high-specification devices from Chinese manufacturers such as Xiaomi, Oppo, and Vivo heavily pressured its entry-level lineup.

Counterpoint Research data from the final quarter of 2020 underscores this disparity, showing LG sold roughly 7,6 juta smartphones globally. During the exact same period, Apple shipped 81,9 juta iPhones, Samsung delivered 62,5 million units, and Xiaomi reached 43 million units. This sharp sales decline eroded the mobile division’s financial viability, leading to consecutive annual losses until management shuttered operations.

Strategic Pivot to Electric Vehicles and B2B

Rather than continuing to absorb losses in a saturated market where mobile operations contributed a mere 7 percent to overall revenue, LG shifted its capital toward higher-growth sectors. According to BGR, the company redirected investments into electric vehicle components, connected devices, smart home technology, robotics, artificial intelligence, and business-to-business (B2B) services.

This strategic reallocation paid off significantly by 2026. LG reported an order backlog for its vehicle component division valued between 90 trillion and 100 trillion won, equivalent to roughly Rp 1,11 kuadriliun, providing a secure revenue cushion for upcoming years. Meanwhile, the company’s B2B operations expanded to generate about 36 percent of total corporate revenue.

Frequently Asked Questions

• When did LG officially stop making smartphones?
  LG decided to terminate its smartphone business operations in 2021 after nearly six consecutive years of financial losses in its mobile division.
• What was LG’s peak market share in the mobile industry?
  According to Strategy Analytics data, LG’s global smartphone market share reached its highest point at approximately 5,2 persen in the third quarter of 2014, driven by strong sales of the LG G3 and L series.
• Where did LG invest its capital after leaving the phone market?
  The company redirected investments into electric vehicle components, connected devices, smart homes, robotics, artificial intelligence, and B2B solutions.
• How much is LG’s vehicle component backlog worth?
  According to BGR reporting, LG’s vehicle component division secured an order backlog valued between 90 trillion and 100 trillion won by 2026.