SK Telecom Q1 2026 Earnings Report

SK Telecom EPS Results

• Actual EPS: $0.57
• Consensus EPS: $0.47
• Beat/Miss: Beat by +$0.10
• One Year Ago EPS: N/A

SK Telecom Revenue Results

• Actual Revenue: $2.92 billion
• Expected Revenue: $2.98 billion
• Beat/Miss: Missed by -$62.69 million
• YoY Revenue Growth: N/A

SK Telecom Announcement Details

• Quarter: Q1 2026
• Date: 5/8/2026
• Time: Before Market Opens
• Conference Call Date: Thursday, May 7, 2026
• Conference Call Time: 3:00AM ET

SK Telecom (NYSE:SKM) Co., Ltd. (NYSE:SKM) is South Korea’s largest wireless carrier, offering a comprehensive range of mobile telecommunications services. The company operates 5G, 4G LTE and IoT networks, providing voice, data and messaging solutions to consumers and businesses. Beyond traditional wireless services, SK Telecom delivers fixed-line broadband, digital content platforms, cloud computing and cybersecurity offerings designed to support enterprise digital transformation and the growing demand for high-speed connectivity.

Established in 1984 as Korea Mobile Telecommunications Services, SK Telecom pioneered cellular service commercialization in South Korea and has continually expanded into new technology areas. As a subsidiary of SK Group, one of Asia’s leading conglomerates, the company has diversified into media, entertainment, semiconductor materials and energy. SK Telecom launched the world’s first nationwide 5G commercial network in 2019 and developed the T world platform to integrate digital lifestyle services, underscoring its focus on research, development and next-generation innovation.

Headquartered in Seoul, SK Telecom serves tens of millions of domestic subscribers and extends its reach internationally through strategic partnerships and joint ventures in markets including the United States, Southeast Asia and India. The company’s executive leadership comprises seasoned telecommunications and technology professionals who have overseen multiple network evolutions and service expansions. Collaborating with global technology vendors, SK Telecom continues to explore emerging solutions such as AI-driven smart factories, autonomous mobility and metaverse platforms to reinforce its position at the forefront of the ICT industry.

SK Telecom Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: SK Telecom reported Q1 consolidated revenue of KRW 4.3923 trillion (up 1.5% Q/Q) and operating income of KRW 537.6 billion, stating results have recovered to pre-cybersecurity-incident levels.
• Positive Sentiment: The company resumed quarterly dividends with Q1 DPS of KRW 830, plans to pursue stable dividend payments for 2026 and transferred KRW 1.7 trillion to retained earnings to enable tax-exempt year-end dividends.
• Positive Sentiment: MNO saw roughly 210,000 handset net adds in Q1 and intends to grow subscribers by targeting high‑LTV segments while avoiding excessive spend, prioritizing profitability.
• Neutral Sentiment: AI/data‑center revenue grew ~89% YoY; SKT is expanding capacity (Gasan, Pangyo, Ulsan, planned Seoul sites) and pursuing global partners, but it has not disclosed detailed AIDC profitability metrics beyond saying they are comparable to telecom.

Presentation

[Operator]

The conference call for the First Quarter of Fiscal Year 2026 Earnings Results by SK Telecom will commence in a few minutes. Please wait until the conference begins.

[Operator]

[Break]

[Operator]

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[Translator]

Good morning and good evening. Thank you all for joining the conference call for the SK Telecom Earnings Results. This conference will start with a presentation followed by a Q&A session. If you have a question, please press star and one on your phone during the Q&A. Now we will begin the presentation on SK Telecom's first quarter of fiscal year 2026 earnings results.

[Kim Tae-hee, Investor Relations Officer at SK Telecom]

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[Translator]

Good afternoon. I am Kim Tae-hee, IRO of SK Telecom. I first like to ask for your kind understanding that the earnings call started later than scheduled. Let us now begin the earnings conference call for the first quarter of 2026. Today, we will first deliver a presentation on the financial and business highlights, followed by a Q&A session. Please note that all forward-looking statements are subject to change depending on various factors such as market and management situations. Let me now present our CFO.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Good afternoon. This is Jong-seok Park, CFO of SK Telecom.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

At the beginning of this year, we said that we would focus on strengthening fundamental business competitiveness centered on customer value and restore profitability through sophisticated AI business in 2026. The first quarter was a significant period in which this direction began to translate into actual results.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Thanks to ceaseless efforts to regain our customers trust, the company recorded a net subscriber add this quarter, and the fundamentals of our core telecom business are rapidly returning to normal.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

The performance of the AI business is gradually improving as a result of business restructuring based on a strategy of focus and prioritization. As these changes led to actual results, we were able to post earnings similar to the levels prior to the cybersecurity incident.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

With business performance returning to normal, the company has decided to resume dividend payments starting this quarter.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Dividend per share for the first quarter is KRW 831.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

We are pleased that we were able to deliver on the promises that we made during the last earnings call. We will make every effort to restore the dividend level by normalizing earnings on a full year basis through continuous improvement of the telecom business fundamentals and creation of additional results from the AI business.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Let me now report on the financial results for Q1. Consolidated revenue posted KRW 4.39 trillion, up 1.5% Q-on-Q on the back of MNO revenue growth driven by subscriber growth and the growth trend of the data center business.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

We posted KRW 537.6 billion in consolidated operating income. Our quarterly operating income exceeded more than KRW 500 billion, which is attributable to extensive efforts to regain customers trust and company-wide initiatives to improve productivity.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Let me now present business highlights by business line.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

MNO achieved a handset subscriber net add of approximately 210,000 in the first quarter, which is a substantive outcome of diverse measures taken to innovate customer value and restore customers trust.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

We are not complacent, but remain committed to further strengthening business fundamentals and competitiveness with customer friendly products and services. We have expanded customer benefits and usability by restructuring the membership program, and we're currently overhauling price plans to offer more choices to customers.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

The fixed line business is also producing stable results thanks to continued subscriber net adds, an increase in the share of subscribers signing up for higher price plans, including Giga price plan, and a stronger subscriber retention trend.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

We will do our utmost to achieve the dual objectives of subscriber recovery and profitability enhancement through constant change and execution based on the philosophy that customers are the essence of our business.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

In the AI business, the effects of the strategy of focus and prioritization are gradually becoming visible.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

AI data center revenue is maintaining a growth trend year-over-year, driven by Pangyo Data Center and higher utilization of Gasan Data Center. The construction of Ulsan AI Data Center is underway, and we plan to pursue additional scale-up by building new data centers in areas including Seoul.

[Park Jong-seok, CFO at SK Telecom]

[Non-English content]

[Translator]

New opportunities are emerging for our AI data center business due to the surge in demand for AI data centers from global tech companies. Based on business experience and differentiated competitiveness across the entire value chain of AI data centers, we will actively pursue partnerships with global players and keep expanding our AI infrastructure business.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Within AI B2C business, the agent business is evolving in a direction that creates synergy with the telecom business and enhances fundamental competitiveness. We plan to improve AI’s performance by linking it with our proprietary AI foundation model to strengthen its own competitiveness.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

With the increase in AI adoption, the B2B market is undergoing structural change driven by AI transformation, and new AI based markets are taking shape. SK Telecom will secure leadership in the rapidly evolving market by utilizing full stack AI capabilities across infrastructure models and agents, and mobilizing the customer base and execution capabilities secured from our B2B business.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

We ask for the continued support and interest of our investors and analysts as we overcome the crisis and continue driving change and embracing challenges to achieve greater growth. Thank you.

[Operator]

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[Translator]

We will now like to begin the Q&A session.

[Operator]

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[Translator]

Q&A session will begin. Please press star one, that is star and one, if you have any questions. Questions will be taken according to the order you have pressed the number star one. For cancellation, please press star two, that is star and two on your phone.

[Operator]

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[Translator]

The first question will be provided by Seung-Woong Lee from Yuanta Securities. Please go ahead with your question.

[Seung-Woong Lee, Analyst at Yuanta Securities]

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[Translator]

I'm Seung-Woong from Yuanta Securities. Thank you for the opportunity to ask you questions. I have two questions. First of all, as you mentioned during your earnings presentation, the company started quarterly dividend payment starting from Q1, and I'd like to understand the overall shareholder return plan and the size of the shareholder return for the entire year of 2026. Secondly, I can see that the company was able to produce earnings results that are similar to the levels prior to the cybersecurity incident. Is it safe to understand that this type of trend will become a new normal? I'd like to get some guidance from the company on a full year basis earnings outlook. Thank you.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

First of all, thank you for your questions. I'd like to comment on the question on our annual earnings outlook, and then I will move on to addressing your second question on shareholder returns.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

First, on our annual earnings outlook. In the first quarter, our operating profit posted KRW 537.6 billion, and the trend has reversed from the downward trend after the cybersecurity incident and shown an upward trend to be approaching the pre-incident levels. Our goal is to improve the full year earnings further from the current levels.

[Park Jong-seok, CFO at SK Telecom]

[Non-English content]

[Translator]

For our telecom business, thanks to our efforts to restore customers' trust, which is our number one priority in 2026, we achieved a net addition to handset subscribers in Q1, contributing to the recovery of the bottom line as well as the top line.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

For our AI business, we are reviewing and implementing various measures to improve the structural profitability by pursuing pivoting and discontinuation of low margin businesses through the strategy of focus and prioritization. In addition, data center business is seeing a meaningful growth trend, and the B2B business has revised its strategy to focus on AI full stack capabilities. We believe that these businesses will drive revenue and contribute to bottom line improvements for the remainder of the year.

[Park Jong-seok, CFO at SK Telecom]

[Non-English content]

[Translator]

Finally, we are working to improve productivity in terms of business operations and processes through enterprise-wide AI tool adoption and AX transformation of call centers, and these measures are having a positive impact on cost efficiency improvement.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

In short, we will do our utmost to recover the annual to be higher than the pre-incident levels through profitability recovery of the telecom business, expansion of growth businesses centered on AI data centers, and continuous productivity enhancement.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Now I'd like to speak about shareholder returns for 2026.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

As was announced earlier, we resumed quarterly dividend payments with the DPS for the first quarter of KRW 831. I'd like to thank our shareholders very much for their kind understanding and patience. As earnings continue to recover this year, we plan to conduct dividend payments as stably as possible.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

As for the size of the dividends for the whole year, when concrete full year earnings become more materialized, the board of directors will have discussions and make decisions in consideration of business performance and financial structure. I won't be able to share with you any specific number at this point, but I promise that we will do our utmost to restore the dividend levels to the previous levels.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

At the annual general meeting of shareholders in March, the company transferred capital reserves of KRW 1.7 trillion to retained earnings to allow tax-exempt dividends, which is expected to deliver substantive benefits to shareholders. For your reference, according to relevant law, tax-exempt dividends are possible from the 2026 year-end dividends.

[Operator]

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[Translator]

The following question will be presented by Joonsop Kim from KB Securities. Please go ahead with your question.

[Joonsop Kim, Analyst at KB Securities]

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[Translator]

I'm Kim Joonsop from KB Securities. Thank you for the opportunity. I have two questions. One on MNO marketing, the other on AIDC. You have produced a recovery trend in terms of the net subscriber adds as well as a market share. I'd like to understand the overall subscriber market share target for SK Telecom and the marketing direction, and how you're planning to strike a balance between profitability and marketing. Secondly, when you reported that the AIDC revenue in the first quarter has increased by 89% year-over-year, and I'd like to understand how this AIDC business is making meaningful contribution to your profitability. If you can give us some color, I would appreciate it.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Thank you for your questions. I'd like to address your question on our AIDC business, I will hand over to Mr. Bai Byeongchan in charge of MNO support, who will answer your question on our MNO subscriber targets.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

First, let me comment on the timeline as to when AIDC business will be able to make meaningful earnings contribution.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

First of all, I'd like to remind you that we only announced AIDC revenue numbers, and we do not disclose any other indicators, including profitability related indicators. We're aware that the market is interested in knowing this, but please understand that we are doing so in consideration of various factors, including the domestic data center market situations.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Nevertheless, what I can say is that the AIDC business is comparable to the existing telecom business in terms of profitability, and there's much room for the AIDC business to become even more profitable going forward.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Since AIDC is our key growth business, we will think of what we can share, to help investors better understand our AIDC business performance.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Now I'd like to turn to Mr. Bai in charge of MNO support to answer your question on our MNO subscriber targets.

[Byeongchan Bai, SVP at SK Telecom]

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[Translator]

I'd like to comment on our MNO subscriber target. The new year 2026 started with the number of handset subscribers reduced by around 986,000 year-over-year.

[Byeongchan Bai, SVP at SK Telecom]

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[Translator]

Reflecting on our performance in the first quarter, we were able to achieve a net add in subscribers on the back of changes in the competitive landscape back to school marketing to attract new subscribers and S26 flagship handset marketing. We were able to achieve net addition to our handset subscribers of 208,000.

[Byeongchan Bai, SVP at SK Telecom]

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[Translator]

Throughout the year, we will continue to make efforts to recover subscribers by targeting new segments, including foreigners, and strengthening competitiveness in terms of products, services, and sales channels.

[Byeongchan Bai, SVP at SK Telecom]

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[Translator]

We continue to strengthen fundamental competitiveness through business operation focused on profitability, we believe that the subscriber base and the market share will naturally grow.

[Byeongchan Bai, SVP at SK Telecom]

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[Translator]

Based on this approach, we will avoid engaging in excessive spending competition aimed solely at increasing subscriber numbers, but rather focus on market operation on securing high LTV subscribers.

[Operator]

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[Translator]

The following question will be presented by Aram Kim from Shinhan Securities. Please go ahead with your question.

[Aram Kim, Analyst at Shinhan Securities]

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[Translator]

I'm Kim Aram from Shinhan Securities. I'd like to ask you two questions. First of all, telecoms equipment providers, both in Korea as well as abroad are focusing on developing AI RAN, which is about using telecommunications network infrastructure for AI functions such as inference. I'd like to get SK Telecom's view on AI RAN. Secondly, there is an increasing demand and growth for AI traffic, and I'd like to understand what this increase in AI traffic, what kind of business opportunities will this bring to SK Telecom as a telco? Thank you.

[Park Jong-seok, CFO at SK Telecom]

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[Translator]

Thank you for your question. On your questions on AI RAN as well as business opportunities brought by AI traffic, Mr. Jong-hoon Lee, in charge of network strategy, will address them.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

I am Lee Jong-hoon, in charge of network strategy. I'd like to first talk about expected benefits and commercialization plans of AI RAN.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

AI RAN is evolving in two domains. One is to improve telecommunications network infrastructure using AI, and the other is to use wireless network infrastructure as a platform to provide AI services.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

In the first domain, we expect to be able to automate base station operations through AI-based failure prediction, optimization of traffic and resources, and power efficiency improvement. This will lead to higher efficiency and improved customer experience. As for the second domain, we may be able to create new business opportunities and generate profit from the provision of AI services, such as inference and media processing by utilizing AI computing resources at the base stations.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

We are actively participating in technology research and standardization together with global players and manufacturers such as Samsung, DOCOMO and NVIDIA for the evolution of AI RAN.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

AI RAN is still in an early stage, so we will consider the adoption of AI RAN by comprehensively considering various aspects, such as technology maturity, standardization, validation on commercial networks, and other aspects.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

We will continue to maintain technology leadership in the next generation network technology areas, including AI RAN, and use the technology leadership to proactively secure new business opportunities.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

Next, I like to make some comments on AI traffic.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

While there is significant increase in AI traffic, the share of AI traffic in the entire traffic is still not very high.

[Jong-hoon Lee, Head of Infrastructure Strategy at SK Telecom]

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[Translator]

However, we're considering ways to make AI traffic increase with a connection with AI RAN and how to distribute traffic across the networks. We will continue to look into technology to be able to do so.

[Operator]

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[Translator]

There are no questions in the queue right now.

[Kim Tae-hee, Investor Relations Officer at SK Telecom]

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[Translator]

This concludes the earnings conference call for 2026 first quarter of SK Telecom. If you need further explanations or have additional questions, please contact IR anytime. Thank you.

Participants

Executives

• Byeongchan Bai, SVP
• Jong-hoon Lee, Head of Infrastructure Strategy
• Kim Tae-hee, Investor Relations Officer
• Park Jong-seok, CFO

Analysts

• Aram Kim, Analyst at Shinhan Securities
• Joonsop Kim, Analyst at KB Securities
• Seung-Woong Lee, Analyst at Yuanta Securities
• Translator