LG Household & Health Care (LG H&H) is gradually emerging from a prolonged earnings slump, with its cosmetics business returning to profitability and overseas sales expanding. However, persistent weakness in household goods and beverages means a full rebound will take time, signaling a mixed outlook for suppliers and distributors in the medical aesthetics supply chain.
Cosmetics turnaround gains traction
LG H&H’s cosmetics division posted Q1 2025 revenue of KRW 771.1 billion, down 12.3% year-on-year, due to reduced duty-free channel volumes and domestic restructuring. Operating profit fell 43.2% to KRW 38.6 billion, but the division exited a loss-making streak that had persisted since Q2 2024. Analysts attribute the improvement to cost efficiencies and restructuring in China, where the cosmetics business turned profitable in Q1.
China business: recovery still fragile
While the China cosmetics unit achieved a Q1 profit, the recovery is not yet on solid ground. Increased marketing costs for the June 618 shopping festival could push the segment back into the red in Q2. This volatility matters for overseas buyers sourcing from LG H&H, as China remains a key market for premium K-beauty products.
Household and beverage remain under pressure
Household goods revenue fell 0.9% to KRW 397.9 billion in Q1, with operating profit down 7.6% to KRW 25.4 billion, as online channel growth failed to offset declines in traditional retail. Beverage revenue slipped 2.2% to KRW 407.6 billion, and operating profit dropped 6.8% to KRW 43.8 billion, hurt by weak non-carbonated drink sales. These segments are expected to remain a drag in Q2.
Structural reorganization to boost cosmetics
LG H&H has transferred brands including Dr.Groot, Physiogel, Usmile, Dominas, and Avon from its HDB division to the beauty unit. This reorganization is expected to expand cosmetics revenue and strengthen brand competitiveness starting Q2. Analysts forecast Q2 cosmetics revenue of KRW 755.8 billion, up 25% year-on-year, with operating profit turning positive.
What buyers should watch
Overseas distributors and clinic buyers should note LG H&H’s shift toward profitability-focused strategies, including higher unit-price products and reduced duty-free bulk sales. Overseas sales are projected to reach KRW 545.2 billion in Q2, accounting for 33% of total revenue. The company’s improving cosmetics margins and global expansion signal potential for stable supply and premium product availability, though near-term volatility in China and household segments warrants caution.
Source: Read the original report | Published: June 03, 2026