This is on a 2.7% rise in revenues of KRW4.42 trillion (€294 billion)
There’s a lot of rubbish talked about AI in telecoms, so some empirical evidence of it in action is most welcome. Eleven months after Korea’s SK Telecom laid out its AI Pyramid Strategy “to become a global AI company” it seems to be paying off.
Most interesting is that it has just announced a 16% increase in operating profits to KRW537.5 billion (€357.68 million) for Q2 on revenues (to the end of June) that increased by 2.7% to KRW 4.42 trillion. In a world where operators’ revenues seem stuck at low-single digit growth, the profit margin is critical.
According to SKT, the growth was due to “higher performance in the mobile and fixed telecommunications business of SKT and its major affiliates”. Also, revenues from enterprise customers grew by 11% year on year to KRW434.2 billion “fuelled by higher datacentre utilisation and increased cloud orders.”
At the end of Q2, SKT had 16.23 million 5G customers – about 70% of its mobile customers – plus slightly more than 7 million fixed broadband subscribers and 9.6 million for pay-TV.
B2B AI strategy and investment
It has also signed up what it calls “its first AI cloud order from domestic internet service providers” during the quarter and “plans to scale up its AI cloud business significantly.”
It has already invested heavily in various AI companies, most recently ploughing $200 million into Smart Global Holdings (SHG) in mid July. The Californian company build and runs computing systems designed for AI workloads.
They said in a statement: “SKT and SGH also intend to leverage their complementary capabilities to enhance customer offerings in the development of differentiated global end-to-end AI factory and data center solutions and services, advanced memory market products and services, and NPU-based AI edge servers.”
SKT’s CFO, Kim Yang-seob promised at the Q2 earnings report that the company will “showcase our progress as an AI company in the second half of the year”.