[Click eStock] "SKT, Focus on High Growth in AI New Business"

Yuanta Securities evaluated on the 7th that "attention should be paid to SK Telecom (SKT)'s profitability improvement due to cost stabilization and the high growth of new AI-related business sectors."

Visitors touring the SK Telecom booth at the '2024 World IT Show'
[Photo by Yonhap News]

SKT recorded sales of 4.4 trillion KRW in the second quarter of this year, a 2.7% increase compared to the same period last year. Operating profit reached 518 billion KRW, up 16%, showing profitability that exceeded market expectations (consensus).

Lee Seung-woong, an analyst at Yuanta Securities, said, "Stable growth in wired and wireless communications and external growth in new businesses are continuing," adding, "In particular, profitability has greatly improved due to cost efficiencies such as marketing expenses and depreciation, and the trend of cost reduction is expected to continue in the second half of the year."

The analyst stated, "SKT's revenue model is becoming visible based on its AI pyramid strategy," and explained, "Based on the experience of building a super-large AI cluster held by its investment company SGH and the capabilities of edge solutions, SKT plans to combine ‘GPU as a service (GPUaaS)’ and ‘energy solutions’ to expand its global business."

He added, "In B2B, SKT has set a sales target of 60 billion KRW this year based on solutions such as AI Contact Center (AICC)," and explained, "The representative B2C service, A. (A-dot), is planned to evolve into a subscription model by incorporating multi-large language model (LLM) agents."

He continued, "With the upward revision of SKT's earnings estimates, the dividend per share (DPS) has been raised to 3,540 KRW, and the investment opinion ‘Buy’ and target stock price of 65,000 KRW are maintained."