Understanding LG's Decision to Exit the Smartphone Market

LG Electronics has announced the complete closure of its worldwide smartphone business following sustained financial challenges. The move ends the company's decades-long presence in the mobile market as it redirects efforts toward electric vehicles, internet-of-things development, and enterprise technology solutions.

Over the past 23 quarters, LG reported consistent losses in its mobile division, including a significant 841.20 billion KRW deficit in the final quarter of last year. Despite producing capable devices like the LG V60 ThinQ 5G, which offered competitive features against flagship models such as the Samsung Galaxy S20 series, the brand failed to establish a strong market identity. Consumers often associated LG more with television and audio technologies than with smartphones, weakening its mobile visibility.

Customer satisfaction suffered from persistent software issues and limited service infrastructure. Many users reported unresolved performance problems even after updates, while official repair centers remained scarce in numerous markets. Pricing instability further eroded confidence, with models such as the LG Velvet dropping from $600 to $350 within less than a year of release. These factors contributed to alarmingly low customer loyalty rates, falling below 45 percent and declining each quarter.

LG confirmed it will honor warranty commitments and deliver software updates for existing handsets for a limited period, though timelines vary by region. Remaining inventory will continue selling until stock exhausts, with the formal shutdown expected by July 31. The company assures consumers that support will remain available for currently owned LG smartphones throughout the transition.