LG Energy Solution — 2024 at a Glance

KRX: 373220 · Founded 2020 (battery division since 1995) · Seoul, South Korea
Total revenue
KRW 25.6 T (~US$19.3 B)
YoY change
-24.1 %
Operating profit
KRW 575 B (-73.4 %)
Net loss (parent)
KRW (1.02 T) (~US$770 M)
Gross margin
13.3 % (down from 14.7 %)
IRA AMPC credits
KRW 1.48 T (+119 %)
Capital expenditure
KRW 12.4 T (+24.9 %)
ESS revenue
Not disclosed (single segment)

Key takeaways

  • LG Energy Solution does not break out ESS revenue — automotive batteries, mobile batteries, ESS batteries, and others are reported as a single segment, making it impossible to assess the energy storage business in isolation.
  • Revenue fell 24 % to KRW 25.6 trillion as global EV demand softened, while operating profit dropped 73 % to KRW 575 billion. The parent company recorded a net loss of KRW 1.02 trillion.
  • IRA Advanced Manufacturing Production Credits provided KRW 1.48 trillion in other operating income, more than doubling year-on-year — without these credits, the company would have reported an operating loss.
  • Capital expenditure surged 25 % to KRW 12.4 trillion, with non-current assets in America reaching KRW 24.6 trillion, reflecting an aggressive US manufacturing build-out across multiple joint ventures with GM, Stellantis, Honda, and Hyundai.
  • LG Energy Solution is one of the few non-Chinese cell manufacturers at global scale, a positioning advantage as EU Battery Regulation local content rules and US IRA domestic content requirements reshape supply chains.

1. Headline numbers

LG Energy Solution reported total revenue of KRW 25,619,585 million (~KRW 25.6 trillion, approximately US$19.3 billion) for the year ended December 31, 2024, a 24.1 % decline from KRW 33,745,068 million in FY2023. The top-line contraction reflects the broad EV demand slowdown across Western markets and continued battery price compression.

Gross profit fell to KRW 3,405,980 million, with gross margin declining from 14.7 % to 13.3 %. Operating profit dropped 73.4 % to KRW 575,387 million, compressed by a 24.7 % increase in SG&A costs to KRW 4,310,613 million — which includes development costs of KRW 210,408 million.

The company recorded consolidated net income of KRW 338,602 million, but the net result attributable to the parent company was a loss of KRW 1,018,741 million. The difference reflects profitable contributions from joint venture subsidiaries flowing to the consolidated result, while the parent entity absorbed disproportionate costs and impairments.

Metric FY2024 FY2023 Change
Total revenue KRW 25.6 T KRW 33.7 T -24.1 %
Gross profit KRW 3.41 T KRW 4.97 T -31.1 %
Gross margin 13.3 % 14.7 % -1.4 pp
Operating profit KRW 575 B KRW 2.16 T -73.4 %
Net income (loss), parent KRW (1.02 T) KRW 1.24 T Loss vs profit

2. Revenue decline and the EV slowdown

The 24 % revenue decline was driven by the global deceleration in EV adoption, particularly in Europe and North America. European revenue fell KRW 4.97 trillion (-41.5 %), the single largest regional decline in the filing. Customer ordering patterns shifted as automakers adjusted production plans downward.

A notable line item is customer compensation revenue of KRW 1,365,723 million — payments from OEM customers compensating LG Energy Solution for reduced order volumes relative to contractual commitments. This means over KRW 1.3 trillion of top-line revenue in FY2024 came not from selling batteries but from penalties paid by customers who ordered fewer batteries than agreed.

Three customers each accounted for more than 10 % of total revenue, indicating significant customer concentration. The filing does not name these customers, but LG Energy Solution’s major automotive clients include General Motors, Hyundai, and several European automakers.

3. The ESS business — what we know

LG Energy Solution reports a single operating segment: “Automotive batteries, mobile batteries, ESS batteries and others.” Unlike CATL, which discloses ESS revenue and shipment volumes separately, or EVE Energy, which reports ESS as a distinct segment, LG provides no standalone energy storage financial data.

What the filing does reveal is the organizational footprint of the ESS business through its subsidiary structure:

  • LG ES Australia — ESS sales in Australia
  • LG ES Europe GmbH — ESS sales in Europe
  • LG ES Vertech — ESS installation services
  • LG ES Arizona ESS Inc. — ESS manufacturing in the United States
  • LG ES Japan — ESS sales in Japan, newly established in 2024

The creation of dedicated ESS subsidiaries across five geographies — including a new Japanese entity in FY2024 and a US manufacturing subsidiary — suggests the energy storage business is scaling. LG Energy Solution is a recognized supplier of battery cells and DC blocks for utility-scale energy storage, but without revenue disclosure, it is not possible to quantify the business.

Warranty provisions reached KRW 1,693,916 million, up 32.9 % year-on-year. The filing notes these provisions include ESS replacement costs, indicating the company is accounting for field performance issues in its installed ESS base. This is worth monitoring — warranty costs can be a leading indicator of product quality challenges.

4. Geographic revenue and the US manufacturing bet

LG Energy Solution’s geographic revenue mix reveals a company increasingly oriented toward the Americas.

Region FY2024 Revenue Share FY2023 Revenue Share Change
America KRW 10,749 B 42.0 % KRW 11,855 B 35.1 % -9.3 %
Europe KRW 7,029 B 27.4 % KRW 12,002 B 35.6 % -41.5 %
China KRW 5,040 B 19.7 % KRW 6,082 B 18.0 % -17.1 %
Korea KRW 1,747 B 6.8 % KRW 2,412 B 7.1 % -27.6 %
Asia/Oceania KRW 1,055 B 4.1 % KRW 1,398 B 4.1 % -24.5 %

America is now the largest market at 42 % of revenue, up from 35 % in FY2023 — not because American revenue grew, but because European revenue collapsed 41.5 %. Europe went from LG’s largest region (35.6 % vs America’s 35.1 %) to a distant second.

The asset side tells an even more dramatic story. Non-current assets located in America reached KRW 24,579,109 million (~KRW 24.6 trillion) — a significant concentration of manufacturing capacity in the United States. This reflects the ongoing construction of multiple joint venture battery plants and the company’s own facilities, positioning LG Energy Solution as a major beneficiary of the US Inflation Reduction Act.

5. US joint ventures and AMPC credits

LG Energy Solution operates an extensive network of US joint ventures with major automakers:

  • Ultium Cells — JV with General Motors (50 % ownership), manufacturing EV batteries in Ohio, Tennessee, and Michigan
  • Nextstar Energy — JV with Stellantis (51 % ownership), manufacturing in Ontario and expanding in the US
  • L-H Battery — JV with Honda (51 % ownership), for battery manufacturing
  • HL-GA Battery — JV with Hyundai (50 % ownership), for US battery production
  • HLI Green Power — originally a JV in Indonesia, reclassified to a subsidiary during FY2024

These partnerships lock in long-term demand from major automakers while qualifying for US manufacturing incentives. The IRA’s Advanced Manufacturing Production Credit (AMPC) generated KRW 1,480,020 million in other operating income during FY2024, a 119 % increase from the prior year. This item was classified under “other operating income” and was the primary reason the company reported an operating profit at all — without AMPC credits, operating profit would have been deeply negative.

The AMPC trajectory from approximately KRW 677 billion in FY2023 to KRW 1.48 trillion in FY2024 confirms substantial ramp-up in US-based battery production volume. If the credits continue under current IRA provisions, they represent a structural advantage for LG Energy Solution relative to non-US manufacturers.

6. Capital structure and investment

LG Energy Solution is investing aggressively despite the downturn.

Metric FY2024 FY2023 Change
Total assets KRW 60.3 T KRW 45.4 T +32.7 %
PP&E KRW 38.3 T KRW 23.7 T +62.1 %
Capital expenditure KRW 12.4 T KRW 9.9 T +24.9 %
Cash from operations KRW 5.1 T KRW 4.4 T +15.0 %

Property, plant, and equipment grew 62 % to KRW 38.3 trillion, driven by the US joint venture factory build-outs. Capital expenditure of KRW 12.4 trillion exceeded operating cash flow of KRW 5.1 trillion by a factor of 2.4x, meaning the company is relying on external financing to fund its expansion.

Total assets grew 33 % to KRW 60.3 trillion. This rate of asset growth during a year of 24 % revenue decline creates a widening gap between the asset base and the revenue it generates, a pattern that will need to reverse as the new capacity comes online and reaches utilization.

The scale of investment is notable even by industry standards. KRW 12.4 trillion in annual capex (~US$9.3 billion) puts LG Energy Solution among the most capital-intensive battery manufacturers globally.

7. Market context

LG Energy Solution occupies a distinctive position in the global battery industry. Along with Samsung SDI and SK On, it is one of the three major Korean battery manufacturers — and collectively, these companies represent the most significant non-Chinese source of battery cells at global scale.

This matters for energy storage in two ways:

European policy. The EU Battery Regulation introduces sustainability and due diligence requirements that will increasingly shape procurement decisions. European ESS developers receiving public funding face growing scrutiny over supply chain origins. Korean manufacturers, with established operations and governance structures aligned with European expectations, offer a credible alternative to Chinese suppliers.

US IRA requirements. The Inflation Reduction Act’s domestic content and foreign entity of concern (FEOC) provisions explicitly advantage batteries manufactured in the US by non-Chinese companies. LG Energy Solution’s extensive US manufacturing footprint — reflected in the KRW 24.6 trillion of American non-current assets — directly addresses these requirements.

However, LG Energy Solution’s competitive position in ESS specifically is harder to assess than for vertically integrated Chinese competitors like CATL or BYD, precisely because the company does not break out ESS financials. Samsung SDI faces the same transparency limitation.

8. What to watch

LG Energy Solution’s ESS business remains opaque. The company reports a single operating segment that combines automotive, mobile, and energy storage batteries. Until LG provides sub-segment disclosure — as CATL does for ESS revenue and shipments, or as EVE Energy does for its storage segment — it is not possible to determine whether the ESS business is growing, profitable, or a drag on results. The dedicated ESS subsidiary structure across five countries suggests the business is scaling, but the financials cannot confirm it. For a company of this size, the lack of ESS disclosure is a significant gap for energy storage industry analysis.

The US manufacturing build-out is large-scale and still accelerating. KRW 12.4 trillion in annual capex, KRW 24.6 trillion in American non-current assets, and five major joint ventures represent a bet that US-manufactured batteries will command a structural premium through IRA incentives and FEOC compliance. If IRA provisions are modified or repealed, the return profile of these investments changes materially.

Customer compensation revenue of KRW 1.37 trillion is a double-edged signal. On one hand, it demonstrates contractual protections — OEMs paid for ordering fewer batteries than committed. On the other hand, it means over 5 % of FY2024 revenue was penalty income rather than product sales. If EV demand recovers, this line item should shrink as real battery orders replace compensation payments.

LG Energy Solution’s non-Chinese positioning is a genuine strategic asset, but one that depends on policy continuity. EU battery regulation local content rules, US FEOC restrictions, and broader de-risking trends all favor non-Chinese manufacturers. As long as these policy frameworks hold, LG benefits from a narrower competitive field in Western markets for both EV and ESS batteries.

The capex intensity demands attention. Spending 2.4x operating cash flow on capital investment during a loss-making year requires confidence in future demand. The company must demonstrate that the new US capacity reaches adequate utilization rates and that AMPC credits continue flowing. The warranty provisions growth of 33 %, including ESS-specific replacement costs, adds another cost pressure to monitor.

10. Sources

All data in this article is sourced from LG Energy Solution’s K-IFRS Consolidated Financial Statements for the year ended December 31, 2024. LG Energy Solution publishes statutory financial statements only — there is no management discussion and analysis (MD&A) or operational commentary accompanying the filing.

Get BESS manufacturer intelligence

Financials, datasheets, ESG data, and market analysis — delivered when it matters.

Free updates. Unsubscribe anytime.