According to BusinessKorea report last week, LG Innotek will withdraw from the HDI market and strategically shift resources to the semiconductor business.

According to the report, LG Innotek announced that it has decided to terminate the printed circuit board (PCB) business, which is an HDI business and accounts for 3.1% of the company’s total sales. LG Innotek is expected to end PCB production within this year and stop selling PCBs in June next year.

LG Innotek explained that the HDI business is weak due to declining demand for high value-added products from mobile devices and increasing competition. In fact, the company had stated earlier that it was considering exiting the HDI business.

Analysts said LG Innotek’s PCB business sales rely on LG smartphones. This year, LG Innotek’s PCB production is about 156,000, which is less than 30% of the annual output between 2013 and 2016.

LG Innotek pointed out that after closing the PCB business, some resources will be transferred to its semiconductor business, and its PCB employees will also be deployed to the semiconductor business. A LG Innotek spokesperson said: “We want to improve our portfolio by selecting and focusing on businesses that can grow and generate profit.”