SK Telecom (US:SKM)2025-02-12 18:05Financial Data and Key Metrics Changes - Consolidated revenue reported KRW 17,940.6 billion, up 1.9% year-over-year, with sustained growth in all business areas including fixed and mobile, enterprise, and AI [10][27] - Consolidated operating profit grew 4% year-over-year, with an operating profit margin exceeding 10% [4][9] - Net income posted KRW 1,438.8 billion, up 25.6% year-over-year, attributed to business portfolio restructuring and asset efficiency enhancements [12][29] Business Line Data and Key Metrics Changes - The MNO business experienced a slight slowdown in top line growth, but customer-friendly roaming services contributed to revenue growth [10][27] - Significant growth in data center and B2B businesses such as cloud and AICC contributed to consolidated revenue growth [10][27] - AI-related revenue grew 19% year-over-year, with AIX and AIDC being key contributors [16][29] Market Data and Key Metrics Changes - The AI business is divided into two categories: telecom business and AI business, which includes AIX, AIDC, and other AI-related services [15][32] - A. achieved a 160% growth year-over-year in total users, indicating strong market demand for personal AI services [34][46] Company Strategy and Development Direction - The company focused on operational improvements and the AI Pyramid Strategy to refine business models and establish execution systems for becoming an AI company [4][7] - Plans to strengthen global AI partnerships through equity investments and collaborations with tech companies [13][30] - The company aims to build an AI Infrastructure Superhighway and monetize AI-related revenue [16][19] Management's Comments on Operating Environment and Future Outlook - Management anticipates significant economic, industrial, and political changes both in Korea and globally, emphasizing the need to strengthen fundamental competitiveness [20][36] - The company aims for a consolidated revenue target of KRW 17.8 trillion for 2025, representing approximately 1% growth year-over-year [19][36] Other Important Information - The DPS for 2024 was determined at KRW 3,540, maintaining the same level as the previous year, reflecting a cautious approach to shareholder returns amid uncertain market conditions [18][47] - The company plans to introduce a subscription-based paid service for A. within the year [59][91] Q&A Session All Questions and Answers Question: Key focus areas for AI business and revenue outlook - The company restructured into 7 business units focusing on telecom and AI, with expectations for AIX revenue to grow about 30% this year [42][44] Question: Background on maintaining DPS and future shareholder returns - The decision to maintain DPS was made considering the uncertain business environment, with plans for continued investment in growth areas [48][50] Question: Details on A. subscription model and Aster launch - A. is being developed to offer more diverse features, with plans for a subscription model and an open beta service for Aster in the U.S. [60][62] Question: Impact of operational improvements on earnings and 2025 CapEx guidance - Operational improvements led to a 4% increase in operating income, with a focus on optimizing CapEx for efficient network operation [77][79] Question: Outlook on stock price and AI profit generation - The company aims to demonstrate the effectiveness of its AI business in 2025, with a commitment to maintaining high shareholder returns [88][90] Question: AI infrastructure and AIX business models - The company is focusing on building affordable and efficient AI data centers, with AIX revenue expected to grow by 30% in 2025 [106][114]