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LG bullish on Q4 for mobile amid smartphone launch

South Korean electronics giant LG said it expects the health of its mobile business to improve in the fourth quarter of the year, as it launched a new smartphone and smartwatch.

The new models allow users to make calls without being tethered to a handset. Speaking at the launch of these devices, LG mobile chief Cho Juno said various macroeconomic changes, such as a favorable exchange rate will help the company, but did not give any specific numbers or say whether he was referring to profit or revenues.

In the second quarter of 2015, LG said sales in its mobile division were flat year-on-year with shipment volumes falling 3 percent. Operating margin also decreased with the electronics giant blaming "price declines as a result of intensified competitions and increased marketing expenses."


LG phone with two screens

LG will be hoping it can improve the numbers with the launch of its V10 smartphone, which has two front screens – one that can be always on and one that can be switched off. It's a 5.7 inch device which also has two front cameras. Usually smartphones have one.

The second screen can be on and display items such as weather, time, data and battery life. It can also be a launch area for shortcuts for apps.

LG said that when watching movies, for example, the second screen can notify you about a message without disturbing your viewing.

LG has also upgraded the cameras on the device and added a fingerprint sensor which it said can be used with Android Pay – Google's Apple Pay competitor – in the U.S.

LG

There were no details on price but this is a premium device from LG which will be competing in the same bracket as the iPhone 6s and Samsung's Galaxy S6 Plus. In such a crowded market, analysts said that LG is attempting to stand out with the dual screen, but will need to make a big effort to convince consumers that it's a useful feature.

"It is an unusual design, but what it reflects is how difficult it is to build a phone that is visibly different," Ian Fogg, head of mobile at IHS, told CNBC by phone.

"But LG will have to educate users to explain why it matters and it will be hard for LG to use these features to dramatically boost sales volumes for its smartphones."

Smartwatch with 4G

LG also took the wraps off its latest smartwatch, the Watch Urbane second edition, which runs Android Wear, Google's wearables operating system.

The device can connect to 4G and 3G internet, Wi-Fi and Bluetooth, but LG gave very few details about whether the SIM card is built into the device or whether it would need to be inserted manually. There was also no announcement about which operators will support this or how a customer might be able to use this service.

But, the feature will allow people to answer calls and carry out mobile functions without the smartwatch being tethered to a smartphone. This means that users could leave their phone at home while they go for a run and still make calls, for example.

LG Watch Urbane Second Edition
LG
LG Watch Urbane Second Edition

LG is not the only company offering this ability. Samsung launched the Gear S2 smartwatch last month which has 3G connectivity. Still, analysts aren't convinced the feature will be a big deal given that users will most likely have to take out another line with an operator or perhaps have to pay more money on their existing contract.

"It is still a solution looking for a problem. It's a very niche solution at the moment. Smartwaches will be smartphone companions rather than independent devices," Ben Wood, chief of research at CCS Insight, told CNBC by phone.