Financial Performance - Consolidated revenue decreased by 1.9% year-over-year to KRW 4339 billion [9], primarily due to the cybersecurity incident and sales of certain subsidiaries [13] - Consolidated operating income declined significantly by 37.1% year-over-year to KRW 3383 billion [9], impacted by expenses related to the cybersecurity incident [13] - Consolidated net income experienced a substantial decrease of 76.2% year-over-year, reaching KRW 832 billion [9] - Non-consolidated revenue saw a decrease of 1.8% year-over-year, amounting to KRW 3135 billion [15] - Non-consolidated operating income decreased by 44.3% year-over-year to KRW 2509 billion [15], due to increased expenses from the cybersecurity incident [20] - SK Broadband (SKB) revenue increased by 2.4% year-over-year to KRW 1120 billion [9], driven by B2B business growth [22] - SKB operating income increased by 9.8% year-over-year to KRW 92 billion [9] Business Highlights - Telecom-related B2B revenue increased by 1.4% year-over-year [31] - AIDC revenue increased by 13.3% year-over-year [32] - AIX revenue increased by 15.3% year-over-year [32] - 5G subscribers experienced a loss due to the cybersecurity incident [31] - CAPEX increased by 63.6% year-over-year to KRW 635 billion [9] Shareholder Returns - Q2 dividend payment totaled KRW 1768 billion, with a DPS of KRW 830 [52] - The shareholder return policy targets more than 50% of the adjusted net profit for the year on a consolidated basis [53]

Group 1 - The article discusses SK Telecom Co., Ltd. (NYSE: SKM) and highlights its new GPT-3 based services and investments in AI technologies [1] - The author has extensive experience in the financial industry, focusing on small and medium-cap companies across Europe, the United States, and South America [1] - The investment strategy includes targeting mature industries such as mining, oil and gas, and real estate, with a focus on M&A deals, deep value investments, and dividend investing [1] Group 2 - The author aims for an internal rate of return of approximately 5%-7% on investments [1] - The article serves as a platform for readers to provide feedback on stocks owned by the author [1] - The author expresses that the financial figures and expectations provided may not be accurate and encourages readers to seek advice from other financial advisors if needed [1]

Group 1 - The People's Bank of China has increased its gold reserves for eight consecutive months, with the latest figures showing a rise of 70,000 ounces to a total of 73.9 million ounces as of the end of June [2] - By the end of 2027, China aims to have over 100,000 high-power charging facilities nationwide, focusing on local economic development and the promotion of new energy vehicles [2] - The Shanghai Stock Exchange and the China Securities Index Company will launch several specialized indices on July 21, including the Shanghai Stock Exchange Specialized New Index and the China Securities Specialized New 100 Index [3] Group 2 - A new mandatory national standard for passenger car braking systems will take effect on January 1, 2026, introducing requirements for electric transmission braking systems and emergency braking signals [3] - An international standard for testing scenarios of autonomous vehicle systems has been officially released, detailing evaluation processes and testing methods [4] - The U.S. President has signed an executive order extending the delay for "reciprocal tariffs" until August 1, affecting imports from 14 countries with varying tariff rates [8][5] Group 3 - The U.S. stock market saw declines across major indices, with the Dow Jones down 0.94%, the Nasdaq down 0.92%, and the S&P 500 down 0.79%, impacting stocks of Japanese and Korean companies listed in the U.S. [5] - Companies such as Nissan and Toyota experienced significant stock drops, with Nissan down over 7% and Toyota down nearly 4% [5] - The market sentiment is shifting towards a balanced approach, with a focus on large-cap stocks and potential inflows of incremental capital in July [8][9]

Group 1 - The article expresses a beneficial long position in the shares of SKM, indicating a positive outlook on the company's stock performance [1] - The author emphasizes that the article reflects personal opinions and is not influenced by any business relationships with mentioned companies [1] - The information provided is intended for informational purposes only and does not constitute a solicitation to buy or sell securities [2] Group 2 - Past performance of investments is highlighted as not guaranteeing future results, suggesting a cautious approach to investment decisions [3] - The article clarifies that no specific recommendations or advice are given regarding the suitability of investments for particular investors [3] - The authors of the article are identified as third-party contributors, which may include both professional and individual investors without formal licensing [3]

Core Viewpoint - Investors in the Wireless Non-US sector should consider SK Telecom (SKM) and TeliaSonera AB (TLSNY) for potential value investment opportunities [1] Valuation Metrics - SKM has a Zacks Rank of 1 (Strong Buy), indicating a stronger earnings outlook compared to TLSNY, which has a Zacks Rank of 3 (Hold) [3] - SKM's forward P/E ratio is 8.85, significantly lower than TLSNY's forward P/E of 22.39, suggesting SKM may be undervalued [5] - The PEG ratio for SKM is 1.36, while TLSNY's PEG ratio is 4.34, indicating that SKM's valuation is more favorable when considering expected earnings growth [5] - SKM's P/B ratio is 1.03, compared to TLSNY's P/B of 2.63, further supporting the argument that SKM is a better value option [6] Value Grades - SKM has a Value grade of A, while TLSNY has a Value grade of C, highlighting SKM's superior valuation metrics and earnings outlook [6]

Core Viewpoint - The article emphasizes the importance of value investing and highlights SK Telecom Co. (SKM) as a strong candidate for value investors due to its favorable valuation metrics and strong earnings outlook [2][8]. Valuation Metrics - SKM has a Zacks Rank of 1 (Strong Buy) and an A grade for Value, indicating it is among the strongest value stocks currently available [4]. - The stock's P/E ratio is 9.31, which is lower than the industry average of 10.04. Over the past 52 weeks, SKM's Forward P/E has ranged from 9.01 to 10.91, with a median of 9.80 [4]. - SKM's P/B ratio is 1, compared to the industry's average P/B of 1.84. The P/B has fluctuated between 0.81 and 1.10 over the past 12 months, with a median of 1.01 [5]. - The P/S ratio for SKM is 0.63, significantly lower than the industry average of 1.07, indicating a potentially undervalued stock based on sales [6]. - SKM's P/CF ratio stands at 8.64, which is attractive compared to the industry's average P/CF of 15.59. The P/CF has varied from 8.36 to 11.18 over the past year, with a median of 9.24 [7]. Investment Outlook - The combination of SKM's favorable valuation metrics and strong earnings outlook suggests that it is likely undervalued at present, making it an appealing option for value investors [8].

Group 1 - SK Telecom Co., Ltd. filed its Annual Report on Form 20-F for the year ended December 31, 2024 with the U.S. Securities and Exchange Commission on April 29, 2025 [1] - The 2024 Annual Report can be accessed on SK Telecom's official website and the U.S. Securities and Exchange Commission's website [1] - Printed copies of the complete audited financial statements for the year ended December 31, 2024 can be requested free of charge [1]

[Certain Defined Terms and Conventions Used in This Annual Report](index=4&type=section&id=CERTAIN%20DEFINED%20TERMS%20AND%20CONVENTIONS%20USED%20IN%20THIS%20ANNUAL%20REPORT) Key terms, abbreviations, and conventions are defined, noting IFRS compliance and a change in MSIT subscriber data reporting - Consolidated financial statements are prepared in accordance with **International Financial Reporting Standards (IFRS)**, as issued by the International Accounting Standards Board (IASB)[16](index=16&type=chunk) - Beginning December 31, 2023, the Ministry of Science and ICT (MSIT) started publishing subscriber data for mobile phone services only, which is **not comparable to prior years' overall wireless service subscriber data**[15](index=15&type=chunk) [Forward-Looking Statements](index=5&type=section&id=FORWARD-LOOKING%20STATEMENTS) Forward-looking statements are identified, subject to risks and uncertainties regarding 5G, AI, and capital expenditures - Plans for capital expenditures in 2025 include investments to maintain and enhance 5G/LTE/Wi-Fi networks, develop IoT and AI solutions, data infrastructure, and further research and development of 5G and 5G-Advanced technologies, with an emphasis on incorporating **AI technology** into various business areas[20](index=20&type=chunk) - The company aims to make significant investments to build and develop next-generation growth businesses in cloud computing, data centers, subscription services, AI B2C/B2B services, and other innovative products, actively integrating **AI technology**[20](index=20&type=chunk) - Forward-looking statements are subject to risks and uncertainties, including changes in the regulatory environment, technology changes, competitive pressures, political changes, foreign exchange currency risks, foreign ownership limitations, and credit risks[21](index=21&type=chunk) Part I [Item 1. Identity of Directors, Senior Management and Advisers](index=7&type=section&id=Item%201.%20IDENTITY%20OF%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20ADVISERS) Information regarding directors, senior management, and advisers is stated as 'Not applicable' for this section [Item 1.A. Directors and Senior Management](index=7&type=section&id=Item%201.A.%20Directors%20and%20Senior%20Management) [Item 1.B. Advisers](index=7&type=section&id=Item%201.B.%20Advisers) [Item 1.C. Auditors](index=7&type=section&id=Item%201.C.%20Auditors) [Item 2. Offer Statistics and Expected Timetable](index=7&type=section&id=Item%202.%20OFFER%20STATISTICS%20AND%20EXPECTED%20TIMETABLE) Information regarding offer statistics and expected timetable is stated as 'Not applicable' [Item 3. Key Information](index=7&type=section&id=Item%203.%20KEY%20INFORMATION) [Item 3.A. [Reserved]](index=7&type=section&id=Item%203.A.%20%5BReserved%5D) [Item 3.B. Capitalization and Indebtedness](index=7&type=section&id=Item%203.B.%20Capitalization%20and%20Indebtedness) [Item 3.C. Reasons for the Offer and Use of Proceeds](index=7&type=section&id=Item%203.C.%20Reasons%20for%20the%20Offer%20and%20Use%20of%20Proceeds) [Item 3.D. Risk Factors](index=7&type=section&id=Item%203.D.%20Risk%20Factors) Various risks are detailed, including competition, regulation, technology, cybersecurity, foreign ownership, and Korean-specific factors - The company faces substantial competition across all businesses, including from three mobile and fixed network operators (KT, LG U+) and Mobile Virtual Network Operators (MVNOs); MVNOs' combined market share increased from **15.5% in 2023 to 16.9% in 2024**[30](index=30&type=chunk)[31](index=31&type=chunk)[33](index=33&type=chunk) - The company's businesses are subject to extensive government regulation, including rate regulation (e.g., mandated discounts, introduction of mid-tier/low-tier 5G plans), technology standards, frequency allocation, MVNO network leasing obligations, interconnection rates, and competition regulation as a 'market-dominating business entity'; new regulations related to AI technology are also emerging[45](index=45&type=chunk)[47](index=47&type=chunk)[49](index=49&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) - Failure to implement or adapt to technological advancements (e.g., 5G-Advanced, successor to 5G) in a timely and cost-effective manner, or to recoup significant capital expenditures for network development, could adversely affect the business[41](index=41&type=chunk)[42](index=42&type=chunk)[44](index=44&type=chunk) - A malware attack on April 19, 2025, resulted in the leakage of certain USIM information of 5G and LTE network subscribers; the company is investigating and implementing mitigation measures, but cannot predict the full extent of harm or regulatory actions[87](index=87&type=chunk) - The Telecommunications Business Act limits aggregate foreign ownership of voting stock to **49.0%**; if SK Inc. (**30.6% owner**) is deemed a foreign entity, this limit could be exceeded, leading to voting rights restrictions and potential corrective orders from the MSIT[94](index=94&type=chunk)[96](index=96&type=chunk)[98](index=98&type=chunk) - The company is exposed to political, economic, legal, and regulatory risks specific to Korea, including global economic volatility, domestic political instability (e.g., impeachment of former President Yoon, tariffs on exports), and heightened tensions with North Korea[99](index=99&type=chunk)[100](index=100&type=chunk)[104](index=104&type=chunk) [Item 4. Information on the Company](index=23&type=section&id=Item%204.%20INFORMATION%20ON%20THE%20COMPANY) [Item 4.A. History and Development of the Company](index=23&type=section&id=Item%204.A.%20History%20and%20Development%20of%20the%20Company) The company's history as Korea's leading wireless provider, its 2021 spin-off, and market shares are outlined - SK Telecom is Korea's leading wireless telecommunications services provider, with **24.6 million mobile phone subscribers** and a **43.7% market share** as of December 31, 2024[120](index=120&type=chunk) - Effective November 1, 2021, the company conducted a horizontal spin-off of its semiconductor and certain other non-telecommunications businesses to SK Square, a newly established holding company; concurrently, a **5-to-1 stock split** of common stock was executed[122](index=122&type=chunk)[123](index=123&type=chunk) Korean Telecommunications Industry Penetration (as of December 31, 2024) | Metric | Value | | :--------------------------------- | :------ | | Population of Korea | 51,217 thousand | | Mobile Phone Subscribers | 56,185 thousand | | Mobile Phone Subscribers per 100 Population | 109.7 | | Telephone Lines in Service | 10,325 thousand | | Telephone Lines per 100 Population | 20.2 | | Number of Smartphones | 56,112 thousand | | Penetration of Smartphones | 99.9% | Korean Wireless Telecommunications Market Share (as of December 31, 2024) | Operator | Market Share (%) | | :------- | :--------------- | | SK Telecom | 43.7 | | KT | 30.0 | | LG U+ | 26.2 | | MVNOs (combined) | 16.9 | [Item 4.B. Business Overview](index=29&type=section&id=Item%204.B.%20Business%20Overview) Business segments, strategic vision to become an 'AI Company,' network infrastructure, and regulatory landscape are outlined - The company's operations are reported in three segments: cellular services (wireless voice/data, device sales, IoT, cloud, smart factory, subscription, advertising, curated shopping, AI B2C/B2B), fixed-line telecommunications services (fixed-line telephone, broadband Internet, advanced media, business communications), and other businesses (T-commerce and miscellaneous)[135](index=135&type=chunk) - The strategic vision is to transform into an **'AI Company'** by developing and expanding AI infrastructure, applying AI technology to innovate core business lines and promote new growth businesses, and developing innovative AI services (e.g., 'A.' and 'A*')[141](index=141&type=chunk) - The company formed the Global Telco AI Alliance (GTAA) with Deutsche Telecom, e&, Singtel, and Softbank to establish a joint venture for telecommunications-tailored large-language models and explore AI-related business opportunities[142](index=142&type=chunk) - Operational efficiency efforts include utilizing AI in marketing and customer services, shifting 5G network capital expenditure focus to quality, and reorganizing non-essential businesses through disposals (e.g., SK M&Service, NATE Communications Corporation, F&U Credit Information, Kakao Corp. shares)[146](index=146&type=chunk) Mobile Phone Subscribers by Network (SK Telecom, as of December 31, 2024) | Network | Subscribers (thousands) | | :------ | :---------------------- | | 5G | 17,052 | | LTE | 7,536 | | WCDMA | 325 | | **Total** | **24,913** | - SK Telecom's 5G network provided the fastest upload and download speeds among the three mobile network operators in Korea in December 2024, with a nationwide average download speed of **1,065 Mbps**; 5G penetration reached **50.6%** of total subscribers[180](index=180&type=chunk

Group 1 - The article discusses the performance of KT, a Korean Telecom company, highlighting its declining margins and consistent earnings misses [1] - The author expresses a lack of confidence in KT's financial outlook, suggesting a flight to safety among investors [1] Group 2 - The author has extensive experience in investment analysis, focusing on deep-discount value plays and underappreciated companies [1] - The article reflects a contrarian investment philosophy, aiming to identify companies that can return value to investors [1]

Financial Performance - The Company's revenue increased by 1.9% from 2023 to Won 17.94 trillion in 2024, driven by growth in wireless and fixed-line telecommunications subscribers and the B2B business[183]. - Operating profit rose by 4% from 2023 to Won 1.82 trillion in 2024, with an operating profit margin of 10.2%[183]. - The wireless business accounted for 74% of the Company's operating revenue in 2024, while the fixed-line business contributed 23%[196]. - SK Broadband's IPTV revenue increased by 1.9% from 2023 to Won 1.55 trillion in 2024, driven by a growing number of subscribers and higher ARPU from premium products[206]. - Revenue from high-speed Internet services rose by 5.2% from 2023 to Won 1.55 trillion in 2024, primarily due to an increase in premium plan subscribers[207]. - Revenue from cable TV services decreased by 3.6% from 2023 to Won 369.6 billion in 2024, attributed to a slight decline in subscriber numbers[206]. - The company reported cash flow from operating activities of Won 5.09 trillion for the year ended December 31, 2024, compared to Won 4.95 trillion in 2023[224]. - The company has set a consolidated operating revenue guidance of Won 17.8 trillion for fiscal year 2025[222]. Subscriber Growth - As of December 31, 2024, the Company had over 16.92 million 5G wireless subscribers, accounting for more than 74% of total subscribers[184]. - The total number of media subscribers surpassed 9.6 million in 2024, indicating steady growth in the media business[206]. Capital Expenditures and Investments - Capital expenditures for network investment totaled Won 1.54 trillion in 2024, focusing on expanding 5G service coverage and maintaining network quality[202]. - Capital expenditures for 2024 amounted to Won 2.39 trillion, aimed at enhancing network infrastructure and investing in growth businesses[235]. - The Company strengthened its global AI partnerships through equity investments in AI-related sectors, focusing on AI data centers and collaborations with leading global AI technology firms[186]. Financial Position - The total assets increased to Won 30.52 trillion as of December 31, 2024, primarily due to an increase in cash and cash equivalents[191]. - Current liabilities rose to Won 9.22 trillion as of December 31, 2024, mainly due to an increase in accounts payable[192]. - The company's debt-to-equity ratio was 76.8% as of December 31, 2024, up from 74.0% in 2023[226]. - As of December 31, 2024, the company had cash and cash equivalents of Won 2,023.7 billion, reflecting a significant increase from the previous year[225]. Governance and Compliance - The company received unqualified audit opinions from Ernst & Young Han for the years ended December 31, 2022, 2023, and 2024, indicating no significant issues with the financial statements[241]. - The audit committee held multiple meetings in 2024, discussing key matters such as the 2023 audit results and plans for 2024[245]. - The Board of Directors consists of nine members, including three inside directors and five independent directors, ensuring a diverse governance structure[247]. - The company has established an ESG Committee to deliberate on ESG plans and mandatory disclosures[259]. - The company has committed to improving business procedures to prevent future errors and ensure compliance with regulatory requirements[358][359][364][365][366][367]. Shareholder Information - The company approved dividends for the first quarter of 2024 during the Board meeting on April 25, 2024[253]. - The Board of Directors approved an annual cash dividend of Won 1,050 per share, totaling Won 223,531 million, with a dividend return rate of 1.9% based on market price[369]. - The company implemented a cumulative voting system for shareholders as of December 31, 2024[264]. - The company has a structured approach to equity compensation, including PSUs and SARs, to align management incentives with long-term shareholder value[308]. Employee Compensation - The average wage for employees in 2024 is 161 million Won, with a total aggregate wage of 886,451 million Won for 5,493 employees[282]. - The total fair value of stock options granted to inside directors is Won 105,237,755, while the total for executives is Won 741,117,509, leading to a combined total of Won 846,355,264[297]. - The company granted a total of 243,451 PSUs in 2024, an increase from 228,708 PSUs granted in 2023, indicating a growth of approximately 6.5% year-over-year[307]. Regulatory Issues - SK Telecom was fined 16,829 million Won by the KFTC for inappropriate advertising practices related to wireless service promotions[356]. - The company faced a fine of 1,428 million Won for collusion in bidding prices during negotiations for renting locations for base stations[356]. - The company faced a fine of Won 314 million for false and exaggerated advertising of bundled services, with an implementation plan submitted to improve procedures[366]. - SK Broadband was fined Won 1.093 billion for discriminatory practices in providing gifts to users as part of its telecommunication bundle products[364].