Undoubtedly, business hasn’t been as usual for worldwide known South Korean tech company LG Display Co Ltd (KRX: 034220) the firm posted net losses in the first quarter of the year bringing its quarterly results to five consecutive quarterly net losses.
In the first quarter ended March 31, LG reported net operating losses of 362 billion won ($294.70 million), the value is less than the 390 billon won loss estimated by analyst for the company.
In a similar quarter last year, the company reported a net loss of 132 billion won ($107.46 million) a value less than half the recent loss. LG attributes this rapid loss increase to coronavirus pandemic which has pushed demand of consumer electronics down.
” We expect volatility in demand to increase down the road, as industry sectors are impacted by the COVID-19 outbreak. The difficult situation will inevitably linger, although it is expected that demand in IT products will grow due to stay-at-home orders and consequent surge in online activities,” said LG.
Revenue for the company in the first quarter declined by 20% to 4.7 trillion won.
Experts are arguing price of some consumer electronics like the liquid crystal display panels increased when production was disrupted in China due to outbreak of deadly coronavirus however, this increase was a short term one since productions in other parts which had not yet been hit by coronavirus yet was still going on increasing supply therefore bringing prices down.
Citing data from WitsView, prices of a majority of consumer electronics produced by LG had increased by around 1% from their initial prices a similar quarter last year.
Since the year began LG stock has plunged by more than 33%, the company says it will suspend production of LCD panels in South Korea for the remaining part of the year as a way of minimizing losses.