On Monday, LG Electronics announced that it will be withdrawing from the mobile business. The South Korean company said in a regulatory filing that its mobile communications (MC) unit will no longer produce and sell handsets after July 31, citing a slump in business and fierce competition in the industry as the reasons behind the decision. The announcement came two months after the company said its MC division is open to "all possibilities" for its future operations. The company said its exit from the mobile business will lead to a decline in revenue in the short term but will eventually improve its financial status and management efficiency in the longer period, according to reports in the Yonhap news agency. LG's mobile business has been in the red since the second quarter of 2015. Its accumulated operating losses reached 5 trillion won (US$4.4 billion) last year. LG, once the world's third-largest handset maker, reportedly had talks with Vingroup of Vietnam and Volkswagen of Germany to sell the mobile business, but the talks fell through, according to industry insiders. Analysts said that LG's operating profit could go up by 1 trillion won this year if it withdraws from the loss-making mobile business. The company has been trying to make a turnaround in its mobile business in recent years, shifting its smartphone production base to Vietnam while expanding outsourcing deals. To boost its premium smartphone sales, last year LG launched the Explorer Project, its new mobile category. Under the project, the company released the Wing, a dual-screen smartphone with a rotating form factor, but its sales were apparently disappointing. This year, LG was scheduled to launch a smartphone with a rollable OLED display after it teased the product at the Consumer Electronics Show (CES) 2021. However, the company reportedly scrapped the plan. Analysts said LG's efforts were not enough to turn things around as the company was overshadowed by Samsung Electronics Co. and Apple Inc. in the premium segment, while Chinese brands dominated the budget phone sector. According to market researcher Counterpoint Research, LG was the world's ninth-largest smartphone vendor with a market share of 2 percent after shipping 24.7 million smartphones last year, down 13 percent from a year earlier.