[Concall] SK Telecom Reaffirms Policy to Avoid Price Wars with "Cost-Effective Marketing"...

[Asia Economy Reporter Seulgina Jo] SK Telecom reaffirmed its plan to refrain from cutthroat competition in the future, stating that "the necessary level of net subscriber increase can be maintained through cost-effective marketing."

In a Q&A session during the conference call held after the earnings announcement on the 7th, SK Telecom responded to criticism that its marketing expenses in the fourth quarter were higher than those of competitors by explaining, "Fourth-quarter marketing expenses decreased on a cash execution basis compared to the previous quarter," adding, "The market has stabilized since September last year, and this situation has continued in the fourth quarter and even now."

SK Telecom added, "Going forward, rather than cost competition, we will continue cost-effective activities through efficient marketing, cluster-based marketing, and service differentiation."

SK Telecom's consolidated sales in 2019 amounted to KRW 17.7437 trillion, a 5.2% increase from the previous year, while operating profit decreased by 7.6% to KRW 1.11 trillion. Although sales increased due to the expansion of 5G subscribers and growth in the media business, the heavy burden of large-scale 5G investments and marketing expenses negatively impacted operating profit. Net profit stood at KRW 861.9 billion, down 72.5% due to the equity method gains from SK Hynix.

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