"B2B and Platforms Drive Stable Growth" KT Reports Q1 Operating Profit of 444.2 Billion KRW, Up 15.4% YoY (Update)

[Asia Economy Reporter Koo Eun-mo] KT achieved its first balanced quarterly performance this year as its platform businesses such as artificial intelligence (AI), digital transformation (DX), media, and content showed rapid growth, while its existing core businesses like 5G and high-speed internet grew steadily.

KT announced on the 11th that its consolidated operating profit for the first quarter of this year reached 444.2 billion KRW, a 15.4% increase compared to the same period last year. Revenue for the same period also rose 3.4% to 6.0294 trillion KRW. On a separate basis, operating profit increased 21.4% to 366 billion KRW, and revenue grew 3.3% to 4.5745 trillion KRW.

By segment, sales in the AI·DX business led the growth of the 'digital platform company (Digico)' with 134.5 billion KRW, up 7.5% from the same period last year. Increased demand from major internet data center (IDC) clients in finance and gaming, as well as the opening of the Yongsan IDC in November last year, contributed to the expansion of related sales. Additionally, due to the increase in data consumption from expanded non-face-to-face service use and orders related to the Digital New Deal, total B2B business sales, including corporate lines and enterprise IT·solutions, grew 2.3% to 684.2 billion KRW.

Notably, in the first quarter of this year, digital transformation services in daily life such as AICC (AI Contact Center), Call Check-in, and AI robots were fully launched. The AICC service is expanding its application range from traditionally high call center demand sectors like insurance and finance to public, distribution, and service areas. At the same time, solution products using voice bots for reservation and guidance are being prepared for the food service, franchise, and small business sectors.

IPTV continued its solid growth. Efforts to secure premium subscribers and strengthen service competitiveness through expanded partnerships resulted in sales of 446.2 billion KRW, a 6.8% increase compared to the same period last year.

Wireless revenue, KT’s core business, grew 2.0% year-on-year to 1.7707 trillion KRW as 5G subscribers showed significant growth. As of the end of the first quarter, the cumulative number of 5G subscribers reached 4.4 million, accounting for 31% of postpaid mobile subscribers. With customers’ mobile subscription patterns diversifying and communication service usage becoming more personalized, KT plans to strengthen customized benefits and strive to provide new value and services.

Wired telephone revenue decreased by 0.3% year-on-year, with the decline significantly slowing. The proportion of business-use wired telephone subscribers steadily increased, and strong sales of fixed-rate products helped stabilize the revenue decline. High-speed internet recorded sales of 503.2 billion KRW, similar to the previous year.

Content group sales, considered one of the core businesses in KT’s Digico roadmap, grew 12.2% year-on-year to 199.6 billion KRW. Increased T-commerce and online advertising volume, as well as expanded music distribution, contributed to the sales growth. BC Card’s sales improved by 5.0% year-on-year due to increased domestic purchases despite a decline in foreign tourists caused by COVID-19. On the other hand, KT Estate’s sales fell 41.3% due to decreases in housing sales and hotel revenue.

KT is actively restructuring its growth-focused business portfolio. Following the establishment of KT Studio Genie in January, KT contributed its stakes in StoryWiz and skyTV to KT Studio Genie in March, further concretizing KT Group’s content business. In April, KT acquired Altimedia, a specialized technology company supplying core solutions for media business, strengthening its core technological capabilities related to media platforms.

Significant changes and improvements were also made in the financial business. K Bank surpassed 12.1 trillion KRW in deposits and 5.37 million customers as of the end of last month by expanding partnerships and offering differentiated benefits such as apartment mortgage loans. Additional equity investments are planned within the year. Furthermore, KT announced a strategic equity investment in the asset management service app ‘Bank Salad’ last month, which is expected to enhance fundamental competitiveness in the upcoming MyData-related business.

Kim Young-jin, KT’s Chief Financial Officer (Executive Vice President), said, “Riding on the successful transition to Digico, we achieved operating profit exceeding market expectations in the first quarter of this year. Going forward, the group will maintain stable profits in both wired and wireless businesses and focus on media, finance·commerce, and B2B businesses led by the nation’s top-level ‘ABC’ platforms?AI, Big Data, and Cloud?to grow as a specialized digital platform company.”

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