📊 LG Innotek: Exchange-Rate Headwinds and the AI Substrate Chase - 2026.10.26

Hi, it’s me, Dotori. 🌰 Articles are pouring in ahead of the third-quarter results announcement on the 27th. Let’s start with the big picture.

Why expectations for results are divided 📊

The key issue is the exchange rate. E Today reported that Samsung Electro-Mechanics has the “AI boom” in its favor, while LG Innotek is carrying the burden of exchange rates, which could lead to divergent third-quarter results ^[1]. News1 also highlighted the contrast between the “AI tailwind” and the “exchange-rate headwind” in a similar vein ^[3].

And we can’t leave out Apple. One outlet reported that LG Innotek posted revenue at a record level in its third-quarter results, due to be announced on the 27th, thanks to the new iPhone effect ^[2]. But the same article’s headline says operating profit fell amid exchange-rate pressure. In other words, the revenue and profit graphs aren’t pointing in the same direction. That’s the key connection. Just remember, though, that this is the outlet’s outlook, and the confirmed figures will be released on the 27th.

The substrate battle: Is Samsung Electro-Mechanics ahead? ⚙️

Now let’s look at the value chain. Hans Economy described the AI substrate race ignited by Nvidia as a contest in which Samsung Electro-Mechanics has secured an early lead and LG Innotek is chasing ^[5]. An analysis of AI-driven component shortages spreading beyond memory to MLCCs and substrates also discussed why the two companies’ earnings outlooks are diverging ^[4]. In that analysis, LG Innotek was seen as being held back by falling smartphone demand and exchange-rate pressure ^[4]. That’s the article’s analysis, not the company’s position.

Structurally, the company that gets in first where AI substrate demand is strongest takes first place, while the one following behind comes in second. Based on the current news coverage, the picture is Samsung Electro-Mechanics in first place and LG Innotek in second. Dotori thinks how quickly LG Innotek can catch up in the substrate race will be a factor that shapes the landscape next quarter. Of course, that’s my interpretation based on how the articles frame the competition.

Expansion into robotics and shareholder returns ⚙️

Let’s move on to cameras. LG Innotek announced that it is expanding its business beyond optical technology for smartphone cameras into components for the eyes and hands of robots ^[6]. It unveiled cameras using Nvidia’s sensor data transmission technology and a multimodal vision system, and is also working to develop a business supplying components for robot hands ^[6]. In a sense, the hands that made cameras are reaching out to make robot hands, too. Whether this partnership will translate into significant earnings figures remains an open question.

There’s also news on shareholder returns. The company plans to cancel 2600 of its treasury common shares on the 29th ^[7]. It submitted a share cancellation decision to DART on the 22nd, and the cancellation is a procedure following a board resolution ^[7]. The scale may be small, but it can be read as a sign that the company is following through on established procedures.

Share-price moves and remaining variables 🔗

We should look at the price, too. LG Innotek closed at ₩367,000 on October 26, down -3.17%. The price has swung quite a bit over the past few days. On October 19, it climbed +6.17% to ₩430,500, then fell to ₩376,000 on the 23rd. I’m not trying to predict where the share price will go; I’ll leave you with a few questions.

In the results on the 27th, how much of the new iPhone effect will show up in revenue? How will exchange-rate pressure appear in operating profit? And how far will LG Innotek get in the substrate race? These three factors are intertwined. Once the figures come out on the 27th, let’s see together which parts of today’s discussion turned out to be right, my friend. 🌰

📰 Reference News (7)

1

Samsung Electro-Mechanics gets an “AI boom,” LG Innotek faces “exchange-rate pressure”… Third-quarter results set to diverge - E Today

이투데이 · 2026.10.26

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2

Exchange-rate hit despite “variable aperture” advance… LG Innotek’s third-quarter operating profit declines

네이버뉴스 · 2026.10.26

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4

AI-driven component shortages spread beyond memory to MLCCs and substrates… Why Samsung Electro-Mechanics and LG Innotek have diverging earnings outlooks

네이버뉴스 · 2026.10.26

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5

Nvidia ignites the AI substrate race… Samsung Electro-Mechanics takes the lead, LG Innotek gives chase - Hans Economy

한스경제 · 2026.10.26

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6

LG Innotek joins hands with Nvidia on “robot hands”… Expands camera technology - Economy Talk News

네이버뉴스 · 2026.10.25

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7

[Vegan News] LG Innotek to cancel 2600 treasury shares on the 29th

네이버뉴스 · 2026.10.25

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