KT hits record earnings in Q2 on mobile growth, property gains

KT on Monday reported its highest-ever quarterly operating profit in the second quarter, exceeding 1 trillion won ($720 million) for the first time, driven largely by subscriber growth following a cyberattack suffered by top rival SK Telecom and gains from a major property development project.

The country’s No. 2 mobile carrier said its operating profit jumped 105.4 percent from a year earlier to 1.01 trillion won in the April-June period. Revenue climbed 13.5 percent to 7.43 trillion won. Net profit surged 78.6 percent to 733.3 billion won in the same period.

The company attributed the stellar performance to its core mobile business, which saw revenue increase 1.6 percent on-year to 1.78 trillion won, backed by a sharp increase in 5G subscribers.

KT appears to have benefited from a surge in new users following SK Telecom’s recent data security breach that triggered widespread customer defections. As of June, KT’s mobile subscribers stood at about 27.49 million, up 2.59 million from a year earlier and 1.05 million from the previous quarter, just before the April cyberattack was revealed.

Fixed-line business revenue increased 1.4 percent, with high-speed internet subscribers reaching 10 million in May, driving a 2.1 percent boost in related sales.

KT’s subsidiaries also lifted the bottom line. Its property arm KT Estate saw revenue grow 2 percent on-year on stronger demand for offices and hotels. KT said profits were also buoyed by sales from the Eastpole mixed-use complex redevelopment in eastern Seoul.

The company’s cloud unit KT Cloud posted a 23 percent revenue increase, thanks to higher demand for data center co-location service from global clients and an increase in AI cloud sales to corporate customers.

“We were able to achieve a significant earnings improvement thanks to steady growth in our core telecommunication business, coupled with strong results from our key portfolio,” said Chief Financial Officer Jang Min. “We will continue to accelerate our transformation into an AICT company to ensure sustainable growth while implementing our value-up plan without delay.”

AICT refers to the combination of artificial intelligence and communication technology.

Going forward, KT said it will continue to expand its partnership with Microsoft to launch a Korean-language AI model later this year, as part of the company’s big AI push.

“We have integrated an Azure OpenAI Service-based LLM into our Genie TV platform in July to expand AI features,” Jang told investors during a conference call Monday after the earnings announcement. “We plan to launch a secure public cloud incorporating confidential computing technology and a Korean-language AI model based on ChatGPT in the second half of the year.”

By Ahn Sung-mi ([email protected])