SK Telecom's New Biz Ventures Soar... Q3 Operating Profit Up 20% YoY (Comprehensive)

Sales of 4.7308 trillion KRW · Operating Profit of 361.5 billion KRW · Net Profit of 395.7 billion KRW

[Asia Economy Reporter Kim Heung-soon] SK Telecom overcame the adverse effects of the prolonged COVID-19 pandemic and achieved a roughly 20% increase in operating profit in the third quarter. The improvement in performance was driven by continued growth in the wireless business as well as balanced growth in new business sectors such as media, security, and commerce.

SK Telecom announced on the 5th that it recorded consolidated financial results for the third quarter of this year with sales of 4.7308 trillion KRW and operating profit of 361.5 billion KRW. Operating profit increased by 19.68% compared to the same period last year, and sales rose by 3.72%. The initially forecasted operating profit growth rate was 18.5%, and the sales growth rate was 2.87%, both of which exceeded expectations. Net profit reached 395.7 billion KRW, up 44.18%.

Media, Security, and Commerce: Three Major New Business Sectors See Sales and Operating Profit Increase by 19% and 40%, Respectively

SK Telecom’s new business sectors?media, security, and commerce?all recorded double-digit growth rates, with sales increasing by 18.9% to 1.5267 trillion KRW. Operating profit also rose by 40.3% year-on-year, surpassing 100 billion KRW for the first time ever.

Specifically, the media business saw sales increase by 20.3% year-on-year to 966.8 billion KRW, driven by growth in the Internet TV (IPTV) business and the effect of the April 30 merger with T-broad. SK Broadband strengthened its offerings of the latest movies, overseas dramas, and kids’ content, and launched customized services for mobile customers, resulting in an increase of 129,000 IPTV subscribers compared to the previous quarter. As of the end of September, the number of paid broadcasting subscribers exceeded 8.5 million.

In the security business sector, ADT Caps and SK Infosec introduced contactless (untact) specialized services such as AI facial recognition temperature measurement and “walk-through” type access authentication solutions, leading to sales of 353.3 billion KRW, a 15.5% increase year-on-year. SK Telecom stated, “We plan to expand our business scope and growth momentum by broadening our offerings with the latest ICT-based security solutions such as cloud and convergence security.”

The commerce business division, supported by 11st and SK Stoa, also recorded sales of 206.6 billion KRW, up 18.7% year-on-year. SK Stoa’s sales grew by 47.7% compared to the previous year, propelling it to the top position in T-commerce. 11st also strengthened live commerce and targeted the changed consumption patterns toward contactless services such as same-day delivery grocery shopping, resulting in growth in both sales (135.7 billion KRW) and operating profit (1.4 billion KRW) compared to the same period last year.

Accelerating Growth Engines for the Post-COVID Era, Including Establishing a Mobility Specialist Company Within the Year

SK Telecom plans to establish a mobility specialist company within the year based on the country’s No. 1 mobility platform, “T map,” to pursue its fifth core business. The specialist company will focus on platform businesses such as parking and advertising based on T map, as well as “all-in-one MaaS (Mobility as a Service),” which offers various transportation modes on a subscription basis. It also plans to expand its taxi-hailing business in partnership with strategic partners like Uber. The application market “One Store” is also accelerating preparations for an initial public offering (IPO) targeted for next year.

Wireless sales recorded 2.9406 trillion KRW, a 1.0% increase year-on-year. Although there were sales declines due to the termination of 2G and the prolonged COVID-19 pandemic, the result reflects securing 4.26 million 5G subscribers as of the end of September through enhanced 5G quality and customer-centric service expansion.

SK Telecom is also strengthening contactless services in the wireless business sector targeting the post-COVID era. Representative examples include launching O2O (online-to-offline) services such as “Baro Dochak” and the subscription-based service “V Coloring” with the concept of “Visible Coloring.” On the 31st of last month, it opened “T Factory,” an ICT complex experience space in the Hongdae area of Seoul. SK Telecom emphasized, “We plan to solidify our leadership as the No. 1 operator by providing differentiated customer experiences.”

Meanwhile, LG Uplus announced third-quarter sales of 3.341 trillion KRW and operating profit of 251.2 billion KRW, representing increases of 5.9% and 60.6%, respectively, compared to the same period last year, exceeding market expectations. KT, which will announce its results on the 6th, is expected to report third-quarter sales of 6.0771 trillion KRW, a 2.2% decrease year-on-year, but operating profit is estimated to slightly increase by 1.07% to 318.5 billion KRW.

This content was produced with the assistance of AI translation services.