The logos of South Korea’s major telecom operators — KT Corp., SK Telecom Co. and LG Uplus Corp. (Image courtesy of Yonhap)
SEOUL, Aug.11 (Korea Bizwire) – In a stark contrast to SK Telecom’s sharp decline, KT and LG U+ posted strong financial results for Q2 2025, despite the ongoing challenges in the telecom sector.
SK Telecom’s operating profit dropped by 37.1% year-on-year, falling to 338.3 billion won, largely due to the aftermath of a major hacking incident.
The company also reported a 76.2% decline in net profit and a 1.9% decrease in revenue. The fallout from the breach, including costs for customer compensation and SIM card replacements, contributed to a substantial one-time expense of around 250 billion won.
In contrast, KT posted a record-breaking operating profit of 1.15 trillion won, marking a 105.4% increase from the previous year. Revenue grew by 13.5%, driven by expanding 5G subscriber numbers and mobile number portability.
However, one-time gains from real estate sales were factored in, which may make its future profits more in line with previous years. LG U+ also performed well, with operating profit rising 19.9% to 304.5 billion won.
SK Telecom has decided to waive early termination fees for eligible customers. (Image courtesy of Yonhap)
Both revenue and net profit increased, with wireless business earnings boosted by a higher share of 5G devices and strong growth in MVNO (mobile virtual network operator) lines.
Despite the previous importance of the “Device Distribution Structure Improvement Act” (DanTong Act), the impact of its repeal is expected to be limited. Industry analysts suggest that future profitability will hinge on new business areas, such as artificial intelligence (AI) and internet data centers (IDC).
SK Telecom saw a 13.9% rise in AI revenues, with its AI data business and AI transition services also showing significant growth. The company aims for over 1 trillion won in annual AI revenue by 2030.
KT, through partnerships with global tech giants like Microsoft and Palantir, is working on AI-driven services and network optimization.
LG U+ also reported growth in its IDC business, with a 5% increase in revenue from higher occupancy rates.
Experts believe that the telecom market, despite concerns, is unlikely to overheat in the short term, and monthly number portability activity will remain significantly lower than pre-DanTong Law levels, reducing the pressure on telecoms.
Kevin Lee (kevinlee@koreabizwire.com)
