[Edaily Reporter Choi Oh-hyun ] LG Energy Solution surpassed 9 trillion won in revenue in the third quarter of this year, achieving its highest quarterly revenue to date. Operating profit also reached 756 billion won, marking two consecutive quarters of profitability following the second quarter.

LG Energy Solution announced on the 8th that its consolidated operating profit for the third quarter of this year was preliminarily estimated at 756 billion won. This represents a 25.7% increase compared to the same period last year. Revenue totaled 9.6434 trillion won, a 59% increase year-over-year. According to financial information provider FnGuide Inc., the consensus estimates for LG Energy Solution’s third-quarter earnings were revenue of 8.7989 trillion won and operating profit of 326.4 billion won.

The Advanced Manufacturing Production Credit (AMPC) subsidy, based on the U.S. Inflation Reduction Act (IRA), totaled 416.9 billion won. Excluding this, revenue was 9.2265 trillion won, and operating profit was 339.1 billion won. The operating profit margin, excluding the AMPC benefit, was 3.7%.

Even as the decline in the dollar-won exchange rate weighed on earnings, operating profit surged 567.3% compared to the previous quarter. While the company posted a loss of 127.7 billion won in the previous quarter—excluding tax credit subsidies under the IRA—it returned to profitability in the third quarter, marking a qualitative improvement. In the second quarter, operating profit reached 113.3 billion won, marking a return to profitability after three quarters; however, excluding production subsidies such as the AMPC totaling 241.0 billion won, the company was still in the red.

Key factors contributing to the record-high third-quarter revenue included continued growth in mid-nickel battery shipments to Europe in the electric vehicle (EV) business; the resumption of operations at the North American GM joint venture (JV) and the launch of the HyundaiMotor JV; a stable flow of cylindrical battery shipments to strategic customers; and the expansion of ESS production capacity in North America within the ESS business.

Regarding operating profit, the burden of fixed costs decreased due to increased ESS shipments in North America. Additionally, one-time factors—such as improved capacity utilization resulting from increased shipments of mid-to-low-priced EV pouch batteries in Europe and the receipt of compensation payments from certain EV customers—played a significant role. These compensation payments are made by EV customers who failed to meet their contractual minimum purchase volumes due to a slowdown in EV demand.

LG Energy Solution forecasts sustained revenue growth in the second half of the year, driven by the full-scale launch of ESS production in North America and improved EV shipment volumes. Regarding profitability, while costs associated with stabilizing the overall production system—including ESS—are expected to persist for the time being, the company anticipates that profitability will gradually stabilize as the fixed-cost burden decreases due to sustained volume growth.

Attention is also focused on the possibility of a concentration of large-scale orders toward the end of the year, driven by expanding investment in North American artificial intelligence (AI) data centers and stricter regulations on Chinese-made batteries. LG Energy Solution secured more than 3 trillion won in new ESS orders in the first half of the year, including AI data center projects.

Having recently been selected as a Battery Energy Storage System (BESS) partner for NVIDIA’s “DSX Ready” program—a next-generation AI data center construction initiative—the company expects additional order opportunities in the North American AI data center market to expand over the medium to long term.

LG Energy Solution is scheduled to announce its final financial results on November 3.