LG Electronics is set to expand its datacenter cooling business to meet the growing demand for AI technology. The company, known for its heating, ventilation, and air conditioning (HVAC) offerings, has seen a significant increase in sales of its chillers over the last three years.
With plans to target datacenter operators, LG Electronics is also looking to introduce new products like liquid immersion cooling. These efforts were discussed at the firm’s Investors Forum in Seoul, where executives outlined the company’s 2030 Future Vision focusing on AI, robotics, and connected devices.
LG aims to achieve seven percent annual growth, maintain a seven percent operating profit rate, and increase its valuation to seven times its annual earnings. Progress towards these goals has been promising, with revenue and operating profit both showing positive growth.
Despite challenges in the Korean appliance market, LG Electronics has diversified its revenue streams with subscription services in order to boost sales and profitability. The company plans to derive half of its sales and three-quarters of its profit from platform-based services, business-to-business operations, and new business ventures.
LG’s strategy of combining services with home appliances has been described as a “paradigm shift.” CEO William Cho emphasized the importance of continuous revenue from subscription services, referring to them as “cash cows” that support the core business areas.
The expansion of subscription services will include content and advertising, positioning LG as a prominent player in the media and entertainment industry. The company’s webOS platform-based advertising and content business has shown steady growth, with an expected revenue increase of nearly 60 percent this year.
