LG Energy Solution shares jumped to a near four-month high on Thursday after third-quarter results showed the battery maker is finding growth outside the electric-vehicle market.
The stock rose 6.4% to 416,000 won after LGES reported preliminary operating profit of 756 billion won and revenue of 9.64 trillion won.
Energy-storage shipments in North America, utilisation at European plants and US manufacturing incentives helped.
LGES remained profitable after stripping out tax credits, suggesting its recovery is becoming less dependent on an EV rebound.
Earnings beat was stronger than the headline suggests
Third-quarter operating profit rose 25.7% from the prior year and 567.3% from the previous quarter, while revenue rose 59%.
The 756 billion won profit was more than double the 365.5 billion won Bloomberg consensus cited by Investing.com.
US Advanced Manufacturing Production Credits contributed 416.9 billion won.
Excluding those incentives, LGES generated 339.1 billion won of operating profit, reversing an underlying loss of 127.7 billion won in the second quarter.
That matters because the improvement was not simply a subsidy story.
LGES said stronger North American ESS shipments reduced fixed-cost pressure, while increased European sales of mid- and lower-priced EV pouch batteries improved plant utilisation.
Production resumed at its General Motors joint venture, while its Hyundai Motor joint venture began operations.
Shinhan Investment Securities analyst Lee Jin-myung said, according to Edaily, that “in the short term, ESS and cylindrical batteries are supporting earnings.” Shinhan maintained a Buy rating and a 500,000 won target.
Energy storage is filling the gap left by slower EV growth
The main change in LGES’s earnings mix is coming from energy storage.
Shinhan expects North American ESS production capacity to exceed 50 GWh by year-end as bottlenecks ease.
That gives LGES a second growth engine while passenger-EV demand remains uneven.
The company is benefiting from grid-scale battery demand as utilities and data-centre operators invest in power infrastructure. AI data centres are increasing electricity consumption and driving greater storage demand.
The EV business is not disappearing. Higher European mid-nickel volumes, GM joint-venture production and the Hyundai ramp are helping stabilise utilisation.
But ESS is increasingly absorbing factory capacity that might otherwise sit underused.
LGES also announced a four-year agreement for 240,000 tonnes of Canadian lithium concentrate, strengthening its North American supply chain across EV and storage markets.
The shift means investors are starting to value LGES less as a pure EV story and more as a broader battery infrastructure company.
Next test is whether ESS can support a higher valuation
The rally still leaves LGES below several broker targets.
Shinhan’s 500,000 won target implies upside, while DB Securities maintained a Buy rating and a 570,000 won target.
DB analyst Ahn Hoe-soo argued that LGES’s early US ESS expansion and system-integration capabilities position it well as America emphasizes grid security and domestic supply chains.
The risk is that tax credits still account for more than half of reported operating profit, while ESS production is ramping and the EV slowdown has not ended.
Analysts see part of the quarterly profit boost coming from compensation paid by a North American automaker that failed to meet purchase commitments, meaning some improvement may not repeat.
Investors need to watch subsidy-independent profitability rather than the headline number alone.
LG Energy Solution’s four-month high does not mean EV demand has recovered. It means the company has shown it can improve earnings without waiting for that recovery.
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