LG reported an unimpressive performance in its mobile activities in the quarter to 31 March 2011, with a 10 percent decrease in shipments year-on-year to 24.5 million units taking its toll on both sales and profits – the quarter marked the fourth consecutive operating loss from this unit. In the three months, it reported an operating loss of KRW101 billion (US$93.5 million) from handsets, compared to a Q1 2010 profit of KRW28 billion, on sales of KRW2.85 trillion, down from KRW3.14 trillion. For its mobile communications division as a whole, its operating loss was KRW101 billion, compared to a profit of KRW29 billion, on revenue of KRW2.91 trillion, down from KRW3.17 trillion. The company said that its mobile business saw a “significant improvement” quarter-on-quarter, due to the increase of smartphones in its portfolio and a reduction in its overheads. It expects to improve its product mix further by launching new devices such as the Optimus Black and the Optimus 3G, as well as further cutting its costs, in the coming months. However, the world’s third-largest handset vendor also noted that “competition is expected to intensify with competitors launching new smartphone models along with handset makers striving for growth.”

Separately, processor architecture company ARM announced that it had signed a new licensing agreement with LG, providing the Korean vendor with access to technology which will be used “to drive the company’s platform strategy in applications that include digital TV, set top boxes, mobile phones, tablets and smart grids.” It was previously reported that LG is looking to bolster its handset silicon activities, in order to reduce its dependence on third-party suppliers, as well as the cost and time-to-market for new products. LG first licensed technology from ARM in 1995.