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Investing.com-- Shares of LG Energy Solution Ltd (KS:373220) fell more than 3% on Friday despite a strong quarterly performance, as the South Korean battery giant warned of a potential slowdown in demand amid weakening electric vehicle sales.
The company reported second-quarter operating profit of 492 billion won ($360 million), more than double the 195 billion won reported a year earlier.
Front-loaded orders by automakers anticipating U.S. tariffs and incentives under the Inflation Reduction Act led to the jump in profit.
However, LGES, which counts Tesla Inc (NASDAQ:TSLA), General Motors (NYSE:GM), and Volkswagen (ETR:VOWG) among its key customers, said rising cost pressures from U.S. tariffs and policy changes have made a short-term demand slowdown unavoidable for automakers.
Seoul-listed shares of the company dropped as much as 3.1% to 356,500 won on Friday.
The company also flagged the end of U.S. federal EV subsidies on September 30, which could further restrain demand.