SK Telecom Posts Modest Growth

South Korean operator SK Telecom recorded quite good third quarter. The numbers are promising because of its rapidly growing 5G subscriber base and rising data usage. The operator, which launched 5G service in April, closed September with 1.54 million 5G subs. It is targeting 5 million by the end of 2023.

Mobile revenue in the quarter rose only 0.1 percent to KRW2.49 trillion ($2.13 billion), representing the first year-on-year increase in eight quarters. The figure was also up 2.1 percent sequentially, its second consecutive quarterly increase. Although ARPU slipped 2.8 percent year-on-year to KRW31,166, it also grew sequentially for the last two quarters.

Net profit dropped 74 percent year-on-year to KRW274 billion due to the impact of lower equity income from SK Hynix, and higher 5G marketing and network investment costs. Marketing expenses rose 27.1 percent to KRW788 billion. Consolidated revenue increased 9 percent to KRW4.56 trillion, with 45 percent of turnover generated by non-mobile businesses.

In a statement, SKT said its media, security and commerce businesses have become solid drivers of growth, and it is rapidly shifting itself from being a mobile operator to new ICT company. Its total mobile subscriber base rose 3.2 percent to 28.1 million at end-September. Because some LTE users migrated to 5G plans, 4G penetration slipped to 86 from 88 percent. Capex in the recent quarter jumped 64 per cent to KRW661 billion, which the company said was due to increased investments to expand 5G coverage.