In a decisive move to navigate rapidly shifting global market dynamics, LG Electronics (LG) has charted a new strategic course for 2026, prioritizing “flawless execution” and a fundamental shift towards a profit-driven growth structure. At a press conference held during the Consumer Electronics Show (CES) 2026 in Las Vegas, CEO Lyu Jae-chul unveiled a comprehensive plan built on three core pillars: reinforcing fundamental competitiveness, accelerating the transition to a high-performance business portfolio, and strengthening the company’s profitability-based growth structure through AI Transformation (AX) .

This new direction signals a mature evolution for the South Korean tech giant. Moving beyond its traditional dominance in consumer appliances, LG is aggressively pivoting towards high-margin B2B enterprises, scalable non-hardware platforms, and the deep integration of artificial intelligence across its entire value chain. “The paradigms of industries and competition are shifting at unprecedented speed. Matching the pace of others will not be enough,” Lyu stated, emphasizing the need for speed and superior execution to maintain a competitive edge .

The Three Pillars of LG’s 2026 Strategy

CEO Lyu’s strategy is a multi-pronged attack designed to future-proof the company against economic cycles and intensifying competition. The first pillar focuses on reinforcing fundamental competitiveness. To achieve this, LG has established a new Innovation Drive Division that reports directly to the CEO. This “control tower” will oversee transformations across development, manufacturing, supply chains, and sales to enhance Quality, Cost, and Delivery (QCD). Simultaneously, LG will deepen its investment in “Winning Tech”—proprietary technologies selected for their high customer value and business potential—to widen the technological gap with its competitors .

The second pillar is the acceleration of a high-performance business portfolio. This marks a significant strategic shift where LG is actively rotating its capital and focus away from purely volume-driven sectors towards businesses with stronger growth, higher profitability, and greater resilience. The key areas of focus are:

  • B2B Expansion: Including Vehicle Solutions and HVAC.

  • Non-Hardware Platforms: Such as product/service subscriptions and the webOS platform.

  • Direct-to-Consumer (D2C) Channels: To capture higher margins and build direct customer relationships .

This transition is already yielding results. The share of these high-performance businesses in LG’s total revenue has grown from approximately 29 percent in 2021 to 45 percent in the second half of 2025. Even more strikingly, their contribution to operating profit surged from 21 percent to about 90 percent over the same period, underscoring the profitability of this new direction .

The third pillar is strengthening the profitability-based growth structure through AI Transformation (AX) . LG views AX as the next evolution of digital transformation. Instead of simply optimizing individual tasks, AX aims to integrate processes end-to-end, enabling faster, data-driven decision-making. LG has set an ambitious goal to increase overall productivity by 30 percent within two to three years. This is already being put into practice with tools like LGenie, LG’s internal AI chatbot, which is evolving into a company-wide AI agent platform powered by LG’s own EXAONE model and integrated with external technologies like ChatGPT and Google’s Gemini .

Key Growth Engines: B2B and AI in Focus

LG’s pivot towards B2B is most evident in its Vehicle Solutions and HVAC divisions. The Vehicle Solutions business is expected to deliver its highest annual performance yet in 2026, fueled by a robust order backlog and growing demand for components in Software-Defined Vehicles (SDVs) and AI-Defined Vehicles (AIDVs) . Meanwhile, the HVAC business is positioning itself at the forefront of a massive new market: cooling for AI data centers (AIDCs). As AI computation explodes, so does the heat generated by servers, creating a critical need for high-efficiency cooling solutions, an area where LG is rapidly building its expertise .

LG’s non-hardware initiatives are also gaining significant traction. Its product subscription model, which allows customers to pay for the use of appliances rather than owning them outright, has already exceeded KRW 2 trillion in annual revenue. The webOS platform, now embedded in over 260 million devices worldwide, continues to grow at a double-digit rate, transforming from a simple smart TV interface into a content and advertising platform . The company’s online D2C business also saw a massive boost, with November 2025 sales rising more than 40 percent year-on-year, driven by Black Friday promotions .

To fuel this transformation, LG is significantly increasing its investment in future growth. Despite global economic uncertainty, the company plans to boost resources for future growth—including capital expenditure, R&D, and strategic M&A—by more than 40 percent compared to the previous year. A portion of this funding will come from the highly successful IPO of LG Electronics India. These funds will be channeled into key areas where LG can leverage its existing strengths, including AI Home solutions, smart factories, AI data center cooling, and robotics .

This strategic blueprint, first detailed at CES 2026, demonstrates that LG is no longer just a consumer electronics company. It is transforming into a diversified, technology-centric enterprise focused on high-growth B2B sectors and intelligent, platform-based services, all underpinned by a company-wide commitment to AI-driven efficiency and execution.