LG Energy Solution Releases 2025 Second-Quarter Financial Results

• LG Energy Solution posts KRW 5.6 trillion in consolidated revenue and KRW 492.2 billion in operating profit in Q2 2025
• The company records quarterly operating profit even without North American production incentive, thanks to product mix improvements and enhanced cost efficiency
• In response to recent policy changes and market demands, the company to focus on ESS business in North America and optimizing its product, technology portfolios

SEOUL, South Korea, July 24, 2025 /PRNewswire/ -- LG Energy Solution (KRX: 373220) today announced its second-quarter earnings for 2025, posting a quarterly operating profit even without North American production incentive, mainly through product mix improvements and continued efforts to improve cost efficiency.

The company posted consolidated revenue of KRW 5.6 trillion, an 11.2 percent decrease quarter-on-quarter. The operating profit was KRW 492.2 billion, marking a 31.4 percent increase quarter-on-quarter, with operating profit margin of 8.8 percent. The operating profit includes North American production incentive, which is estimated at KRW 490.8 billion.

"In the second quarter, we secured stable EV battery sales and also started production at our new ESS battery facility in North America," said Chang Sil Lee, CFO of LG Energy Solution. "However, constrained customer purchase sentiment, coupled with the reflection of metal price decline to our average selling price (ASP) affected our quarterly revenue."

Lee added, "At the same time, we saw improvements in our product mix thanks to increased production in North America, along with enhanced cost efficiency and favorable material cost ratio, all of which contributed to the quarterly operating profit even when excluding North American production incentive."

At the earnings conference, LG Energy Solution outlined its market outlook and strategic action plans for the second-half of the year. Following tariff and policy changes in the U.S., Europe, the U.K. and the associated cost pressure on major automakers, the company anticipates a short-term slowdown in EV demand. At the same time, it expects advancements in autonomous driving technology to drive mid-to long-term growth momentum.

The company projects increased demand in the energy storage system (ESS) market, capitalizing on new business opportunities from both existing and new renewable energy plants and AI data centers. It also predicts that the IRA Investment Tax Credit (ITC) will present more opportunities by incentivizing a shift in the supply chain toward non-Chinese battery suppliers.

In terms of market competition, the company expects recent policy changes to strengthen barriers against Prohibited Foreign Entities (PFE) entering the U.S. battery market, thereby reinforcing the advantage for battery companies that have already secured local production capabilities and stable operational competencies.

Taking these transitions into account, LG Energy Solution now aims to build on its second-quarter accomplishments and maintain its growth momentum. In the second quarter, the company focused on establishing local ESS battery production, which recently came to fruition with the start of production at its first North American ESS battery manufacturing hub in Michigan. By proactively adjusting its capacity expansion plans, the company now aims to expand its annual production capacity for ESS batteries to 17GWh by the end of this year.

In terms of operation, LG Energy Solution will first maximize the utilization of its existing production capacity by focusing on ESS batteries and new form factors and chemistries. Also, it will reduce fixed costs by adjusting and scaling down investment plans while securing competitiveness in the supply chain and sourcing.

In terms of its business portfolio, the company will continue to expand its ESS business in North America and secure over 30GWh of annual production capacity in the region by the end of 2026. In Europe, it will start mass producing mid- to low-end batteries such as high-voltage mid-nickel and LFP batteries at its Poland facility in the second-half of the year.

In terms of technological advancement, LG Energy Solution plans to enhance its mid- to low-end product portfolio with EV/ESS LFP batteries and EV LMR (lithium manganese-rich) batteries, while also advancing product competitiveness—including energy density—through innovative technologies. The company will also launch EV batteries with the charging speed of less than 10 minutes by 2028. For dry electrodes, a key driver for cost innovation, the company will evaluate the production feasibility within this year and establish sample production system at its facility in Ochang, Korea.

About LG Energy Solution

LG Energy Solution (KRX: 373220), a split-off from LG Chem, is a leading global manufacturer of lithium-ion batteries for electric vehicles, mobility, IT, and energy storage systems. With 30 years of experience in revolutionary battery technology and extensive research and development (R&D), the company is the top battery-related patent holder in the world with over 69,600 patents. Its robust global network, which spans North America, Europe, and Asia, includes battery manufacturing facilities established through joint ventures with major automakers. Committed to building sustainable battery ecosystem, LG Energy Solution aims to achieve carbon neutrality across its value chain by 2050, while embodying the value of shared growth and promoting diverse and inclusive corporate culture. To learn more about LG Energy Solution's ideas and innovations, visit https://news.lgensol.com.

View original content:https://www.prnewswire.com/news-releases/lg-energy-solution-releases-2025-second-quarter-financial-results-302513675.html

SOURCE LG Energy Solution