Thanks to strong handset sales, LG Electronics' third quarter net profit increased nearly 15-fold. The handset maker posted a net profit of $370 million, which was much better than expected. LG, however, said sales will probably slow or decline in the coming quarters because of a possible slowdown in the U.S. market.
CFO James Jeong said, "We'll keep our inventories tight in the U.S. market to help manage any risks linked to the subprime mortgage issue."
The global operating profit margin for LG's handsets rose to 8.4 percent, up from a record 11.6 percent in the second quarter. Handset sales rose 5.5 percent from a year ago, but they were down 7.5 percent from last quarter. LG's handset ASP was about $130, down from $160 in Q2. Samsung's ASP was $151 in Q3.
For more on LG's quarter:
- read this article from the WSJ (sub. req.)