LG Electronics swings to a loss in the fourth quarter after reflecting costs for voluntary retirements, though annual revenue reaches a record high. LG Electronics said on Friday it posted fourth-quarter 2025 consolidated revenue of 23.8522 trillion won and an operating loss of 109.0 billion won. Revenue rose 4.8 percent from a year earlier, but operating profit turned negative. Revenue also rose 9 percent from the previous quarter, while operating results swung to a loss from a profit.

The main reasons for the fourth-quarter swing to a loss were weaker demand and voluntary retirement costs. Delayed recovery in demand for display-based products and intensifying competition increased marketing spending, it said. It explained it recognised non-recurring costs worth several hundred billion won due to a companywide voluntary retirement programme implemented in the second half to improve workforce efficiency. Net loss for the quarter was 725.9 billion won, widening slightly from a net loss of 713.7 billion won a year earlier.

For the full year, revenue growth and profit declines diverged. On a consolidated basis for 2025, revenue rose 1.7 percent from a year earlier to 89.2009 trillion won, setting a record for a second consecutive year. Operating profit fell 27.5 percent to 2.4784 trillion won. Net profit rose 106.4 percent to 1.2204 trillion won from 591.4 billion won a year earlier.

Growth was led by the home appliance and vehicle components businesses. The two businesses maintained growth despite unfavourable conditions including tariff burdens and an electric vehicle chasm. They recorded growth for 10 consecutive years since 2015. It also expects voluntary retirement costs to help ease fixed-cost burdens over the mid to long term.

B2B revenue rose 3 percent from a year earlier to 24.1 trillion won. Combined operating profit at the VS and ES divisions, the two main pillars of the B2B business, topped 1 trillion won for the first time. Subscription revenue combining products and services rose 29 percent to nearly 2.5 trillion won.

The HS (Home Appliance Solution) division posted revenue of 26.1259 trillion won and operating profit of 1.2793 trillion won. Revenue was a record high. Operating profit also rose slightly excluding one-off costs, partly succeeding in responding to tariffs through production base optimisation, price adjustments and cost improvements.

This year, it will continue growth by expanding its AI home appliance lineup and targeting emerging markets. It will also focus on developing its built-in and components solution business and preparing for the future with areas such as AI home and home robots.

Reflecting voluntary retirement costs of several hundred billion won, it expects fixed-cost reductions over the mid to long term.

The MS (Media Entertainment Solution) division posted revenue of 19.4263 trillion won and an operating loss of 750.9 billion won, swinging to a deficit. Delayed demand recovery and intensifying market competition were cited as reasons.

This year, it will strengthen its lineup with competitive products including Micro RGB across both OLED and LCD. It will also move to identify demand for lifestyle lineups such as StanbyME and Easy TV. It plans to sustain high-speed growth in its webOS advertising and content business by continuing content investment and expanding partnerships.

The VS (Vehicle Solution) division posted revenue of 11.1357 trillion won and operating profit of 559.0 billion won. Both revenue and operating profit were record highs. The company said it expects demand from automakers to be somewhat flat this year as macroeconomic volatility increases, but it will secure stable profitability by strengthening cooperation with automaker OEMs and improving operational efficiency. It is also accelerating efforts to secure capabilities in future vehicle solutions such as SDV (software-defined vehicles) and AIDV (AI-defined vehicles).

The ES (Eco Solution) division posted revenue of 9.3230 trillion won and operating profit of 647.3 billion won. Revenue rose from a year earlier, and operating profit also edged up excluding voluntary retirement costs.

The company said demand is expected to expand this year, mainly overseas, for high-efficiency solutions such as heat pumps using environmentally friendly refrigerants. It will also continue to secure business opportunities in AI data centre cooling solutions. The company said it will proceed with commercialising next-generation liquid cooling solutions and expanding partnerships to develop immersion cooling solutions.