China’s Zero-COVID-19 Policy Messes up Performance
LG Innotek announced on Jan. 25 that its sales and operating profit in the fourth quarter (Q4) of 2022 are 6.5477 trillion won and 170 billion won, respectively. Those increased 14.4 percent and dropped 60.4 percent year on year, respectively.
That day, Samsung Electro-Mechanics announced 1.9684 trillion won and 101.2 billion won as its Q4, 2022 sales and operating profit, down 19 percent and 68 percent from a year ago.
Their overall decline in performance has to do with China’s zero-COVID-19 policy. LG Innotek’s performance was fine until Q3 based on camera module supply to Apple, but Foxconn’s plant in Zhengzhou was shut down in Q4 to affect iPhone 14 production and the camera module supply.
On the part of Samsung Electro-Mechanics, the policy led to a considerable decrease in demand for smartphones and IT products, which adversely affected the company in Q4 as well as Q3.