LG announces closure of the smartphone business

South Korean multinational electronics company LG has finally confirmed that it is closing down its smartphone business and the company confirmed that its existing phones will remain on sale, and will continue to support its products "for a period of time which will vary by region."

LG said in a statement that this decision 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."

The company has yet not said anything about the possible layoffs due to this decision, except that "details related to employment will be determined at the local level." LG said that it expects to complete the smartphone business` closure by the end of July this year. Following the division`s huge losses over the past five years, this move had been rumoured for several months now. 

Once considered a rival to fellow South Korean manufacturer Samsung, LG`s recent high-end smartphones struggled to compete, while its more affordable handsets faced stiff competition from its Chinese rivals. 

LG had previously said it hoped to make its smartphone division profitable in 2021. This news of closure means that LG`s long-teased rollable smartphone is unlikely to ever see the light of day. The last time LG showed off this device was at this year`s virtual CES when the company insisted that the device was real and would be launching later this year.

LG has been considering this move since at least the beginning of 2021. Although a company spokesperson branded an earlier report about the company's potential exit from the smartphone business as "completely false and without merit," an LG official later confirmed that the company had to make "a cold judgment" about the division.

At the time, the official had said that potential measures could include "sale, withdrawal, and downsizing of the smartphone business."Reports emerged in March that LG had tried to find a buyer for its smartphone business, but that talks had stalled and it could instead shut down the division. 

The company had ceased the development of its upcoming phones with rollable displays, and that it had shelved its planned smartphones for the first half of this year. As it lost share to rivals, LG released a series of eye-catching devices with unusual form factors. There was the LG Wing, whose main display rotated to reveal a smaller secondary screen beneath it, or its recent dual-screen devices.

LG also tried its hand at a modular smartphone with the LG G5, only to abandon the initiative a year later. Unfortunately for LG, none of these features were useful enough to turn the phones into mainstream hits, and meanwhile the company's more traditional handsets fell behind their rivals in core areas like camera performance.