Samples of LG Innotek's large-area and extra-large-area FC-BGA substrates. [LG Innotek]
Samples of LG Innotek's large-area and extra-large-area FC-BGA substrates. [LG Innotek]

LG Innotek said Monday its second-quarter sales reached 5.53 trillion won ($3.77 billion) and operating profit came in at 245.8 billion won on a preliminary basis, beating market expectations with a record year-on-year earnings increase.

Operating profit surged 2,057 percent from the same period a year earlier, while sales rose 41 percent to mark the highest second-quarter figure in the company's history. Including first-quarter results, first-half sales totaled 11.06 trillion won — the first time the company has exceeded 10 trillion won in a single half-year period.

The strong performance was driven by sustained high demand not only for LG Innotek's flagship mobile camera modules but also for semiconductor substrates, buoyed by a broader semiconductor boom.

"Despite the seasonal off-peak period, solid demand for mobile camera modules continued from the first quarter," a company official said.

The official added that supply conditions for high-value-added semiconductor substrates — including RF-SiP (radio frequency system-in-package), FC-CSP (flip-chip chip-scale package) and FC-BGA (flip-chip ball grid array) — also remained favorable.

"Mobility components such as vehicle camera, communications and lighting modules also contributed to sales growth," the official said.

LG Innotek has been stepping up efforts to strengthen its high-margin business portfolio by reinforcing core operations in optics and packaging while also pushing growth in physical AI businesses centered on autonomous driving and robotics. The company is placing particular emphasis on expanding its package solutions business, which it views as offering high profitability and growth potential.

By business segment, the optical solutions division — LG Innotek's flagship operation — posted sales of 4.52 trillion won, up 48 percent year on year, leading the overall earnings performance.

Robust demand for high-value mobile camera modules held up even during the off-season, and vehicle camera sales also increased on the back of new model supply to key customers.

The package solutions division recorded sales of 498.4 billion won, up 20 percent from a year earlier.

Growing demand for high-value substrates drove strong supply of RF-SiP and FC-CSP semiconductor substrates, while FC-BGA also contributed to earnings improvement as product supply to global customers expanded.

LG Innotek has been scaling up its high-value substrate production lines to strengthen the business.

The company plans to build a new semiconductor substrate production factory in Vietnam at a cost of about 1.05 trillion won. Key customers are in discussions on long-term supply agreements and have proposed co-investing in the facility. Jo Ji-tae, executive vice president and head of LG Innotek's package solutions division, said at a media tech day event that the company's goal is "to grow the package solutions business to an operating profit of around 1 trillion won within five years."

The mobility solutions division posted sales of 510.9 billion won, up 10 percent year on year.

Sales grew broadly across the entire mobility components lineup, led by high-value vehicle lighting and communications modules. The company plans to improve profitability in the mobility business by increasing the share of high-value products and optimizing resources, while pursuing sales growth through new businesses such as vehicle AP modules.

Kyung Eun-guk, LG Innotek's chief financial officer and executive vice president, said the company has begun expanding its semiconductor substrate production factory in Vietnam to meet rapidly growing demand amid the semiconductor boom, and is also reviewing additional investment.

"We will firmly establish the package solutions business as a core pillar of the company through expanded production capacity, differentiated technologies such as copper post (Cu-post), and the application of AX — AI transformation — to manufacturing processes," Kyung added.


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