SK Telecom (US:SKM)2022-02-09 18:31Financial Data and Key Metrics Changes - SK Telecom reported a revenue of KRW 16.7 trillion for 2021, with a target of KRW 23 trillion by 2025, indicating a significant growth expectation [31] - The mobile and fixed business accounted for 82% of revenue with a growth rate of 3%, while growth businesses accounted for 18% of revenue with a growth rate of 15% [8][31] - MNO revenue grew by 2.7% to exceed KRW 10 trillion, driven by an increase in 5G subscribers [116] Business Line Data and Key Metrics Changes - The mobile and fixed business remains the core, while new growth areas include media, enterprise, AIVERSE, and Connected Intelligence [6][31] - The media business has over 10 million Pay TV subscribers and aims to expand into content commerce and advertising [15][16] - The enterprise business, particularly the data center segment, is expected to grow significantly due to high demand and supply shortages, with a revenue target of over KRW 1 trillion by 2025 [19][20] Market Data and Key Metrics Changes - The 5G subscriber base reached 10 million in January 2022, with expectations to grow by an additional 8 million by 2025 [11] - The fixed line business is expected to see sustained growth due to increasing single households and demand for additional TVs [14] - The cloud revenue was KRW 64 billion in 2021, with plans for expansion in 5G MEC and MSP [20] Company Strategy and Development Direction - SK Telecom is focusing on two targets: stability and growth, reorganizing its business into five groups to maximize corporate value [5][9] - The company aims to leverage synergies between its mobile and fixed line businesses while pursuing growth in new sectors [12][42] - The strategy includes expanding into the metaverse and AI-driven services, with a target of securing over 30 million global MAUs by 2025 [26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving revenue growth driven by the expansion of 5G and new business opportunities in AI and IoT [21][31] - The company is optimistic about maintaining a stable dividend policy while pursuing growth through strategic M&A opportunities [30][32] - Management highlighted the importance of regulatory support for the telecommunications sector, especially in the context of the presidential election [86][88] Other Important Information - SK Telecom has implemented shareholder-friendly policies, including quarterly dividends and a stock split [30] - The company is exploring urban air mobility (UAM) as a future growth driver, collaborating with partners to develop this initiative [28][63] Q&A Session Summary Question: Background of business reorganization into five groups - The reorganization aims to maximize corporate value for each business group, allowing for different valuation matrices for mobile, fixed, media, and AIVERSE [38][40] Question: Growth potential of business groups - Management emphasized the advertising, data center, and subscription businesses as key growth areas, with significant potential for add sales and high-value services [46][50][53] Question: Dividend policy for 2022 - The company plans to maintain a similar dividend amount to the previous year, with expectations for EBITDA growth in the medium to long term [68][70] Question: M&A investment plans - SK Telecom will pursue strategic M&A opportunities, focusing on technology acquisition, talent acquisition, and global expansion [74][76] Question: Regulatory risks from the presidential election - Management believes that the focus on telecommunications and digital infrastructure will remain strong, with less regulatory burden on communication costs [86][88] Question: CapEx trends - CapEx for 2022 is expected to be similar to 2021 levels, with a focus on expanding 5G coverage and network quality [98][100] Question: Data center investments - The company plans to expand data center capacity by 50 gigawatts annually, requiring an investment of KRW 500 billion [141][145] Question: UAM initiative - SK Telecom is exploring synergies with partners for UAM, focusing on communication network capabilities while collaborating on device development [63][64]