SK Telecom Q3 Operating Profit Rises 7.1%... "Nationwide AI Infrastructure Deployment"

Q3 Consolidated Sales of 4.5 Trillion KRW... 2.9% Increase
Enterprise Business Grows 8% Year-on-Year
AI Data Center Opening Next Month... Launch of Subscription Service

SK Telecom's operating profit for the third quarter of this year recorded 533.3 billion KRW, an increase of 7.1% compared to the same period last year.

Yoo Young-sang, CEO of SK Telecom. Photo by Yonhap News

SK Telecom announced on the 6th that its consolidated sales for the third quarter of 2024 reached 4.5321 trillion KRW, operating profit was 533.3 billion KRW, and net profit was 280.2 billion KRW.

Sales increased by 2.9% compared to the same period last year due to steady growth in roaming and enterprise sectors, and operating profit improved by 7.1% year-on-year due to efficiency gains and structural improvements through company-wide adoption of artificial intelligence (AI). However, net profit decreased by 9.1% year-on-year to 280.2 billion KRW.

Since the spin-off in November 2021, SKT has been laying the foundation to leap forward as a global AI company over the past three years. This year, it is accelerating the establishment of AI revenue models. The strategy is to accelerate the transition to an AI company by selecting and focusing on three businesses expected to generate quick profits: AI data centers, AI B2B (enterprise business), and AI B2C (personal services).

The data center business achieved 14% sales growth compared to the same period last year as utilization rates continued to rise. SKT plans to evolve and develop this into an AI data center business, where demand is surging, to further increase business growth rates.

The NVIDIA GPU-based AI data center is scheduled to open next month, and a subscription-based AI cloud service (GPUaaS) is also planned to be launched within the year. The subscription-based AI cloud service is expected to be a competitive service that improves GPU accessibility for domestic companies that find it difficult to purchase GPU resources directly.

The country's only AI data center testbed will also open in Pangyo in December. The newly introduced AI data center testbed will bring together advanced AI semiconductors including NVIDIA and SK Hynix HBM, next-generation liquid cooling solutions, and various solutions owned by SK Group and its partners. It is expected to become a venue for technological innovation to strengthen SKT's differentiated capabilities.

As a mid- to long-term strategy, SKT plans to build nationwide AI infrastructure. The plan is to evolve into nationwide AI infrastructure by establishing regional hub AI data centers and GPUaaS in the metropolitan area as the core, and introducing edge AI technology at base stations.

The AI personal assistant service 'A. Dot' surpassed 5.5 million cumulative subscribers as of the end of September. Last month, SKT expanded the scope of AI personal services from calls to large language model (LLM) search by introducing 'A. Dot Call,' which integrates AI functions into T Phone, and launching the PC version of A. Dot.

In the mobile business, as of the end of September, 5G subscribers reached 16.58 million, increasing the proportion of 5G customers to 73%. Paid broadcasting subscribers numbered 9.62 million, and high-speed internet subscribers reached 7.11 million. Roaming customers in the third quarter recorded approximately 1.36 million, a 23% increase compared to the same period last year. SKT continues to increase new customers through differentiated roaming services such as family roaming rates launched in June last year and the recently introduced roaming customer benefit program ‘Club T Roaming.’

The enterprise business grew by 8% year-on-year, supported by the expansion of data center and cloud businesses. In particular, cloud business sales recorded a high growth of 30% compared to the same period last year. The enterprise AI business is also securing meaningful orders across various industries, and it is expected to become a core pillar of the B2B business in the future.

The third-quarter dividend was confirmed at 830 KRW per share. Kim Yang-seop, SKT CFO, said, "We are currently focusing the company's capabilities on three AI businesses expected to generate quick profits, and through growth in the two core businesses of telecommunications and AI, we will continuously increase corporate value while striving to maximize shareholder returns."