Following weeks of rumours, LG has officially confirmed that it’s closing its smartphone business.
The South Korean tech giant says that the decision to exit the smartphone industry was approved by the company’s board of directors earlier today.
“LG’s strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services,” said LG in a recent press release.
LG says that its current smartphone inventory will continue to be sold worldwide and that it will still provide service support/software updates for a “period of time which will vary by region.” In the Q&A portion of its press release, LG says it “will continue to provide service parts for a minimum of two years from the phone purchase date.” Further, Android 11 and Android 12 updates will still come to “select LG smartphones.”
Regarding layoffs, the company says that “details related to employment will be determined at the local level.”
The company says that leaving the smartphone industry will allow it to focus on “6G” and that it will allow it to strengthen its competitiveness in other business areas.
While LG’s high-end devices were once on par with Samsung’s flagship offerings, the company’s recent smartphones have struggled to compete in the increasingly competitive market.
Reports surrounding LG leaving the smartphone industry have been swirling for several weeks now. A report from late January via The Korea Herald indicated that LG was “considering all possible measures, including sale, withdrawal or downsizing of the smartphone business.” Last week, a report emerged from The Korea Times indicating LG would make an official announcement regarding the future of its smartphone business on April 5th.
It’s more than likely this also means that LG’s fascinating-looking rollable smartphone the company showed off at CES 2021 has been cancelled as well. The last significant LG smartphone to release in Canada was the LG Velvet. While the device was generally well-received for its minimalist design, it suffers from poor camera performance and only features a mid-range Qualcomm Snapdragon 765 processor.
LG expects the “wind down” of its mobile phone business to be completed by July 31st.