SK Telecom (NYSE:SKM) Posts Quarterly Earnings Results, Beats Expectations By $0.22 EPS

SK Telecom (NYSE:SKM) issued its earnings results on Wednesday. The Wireless communications provider reported $0.81 earnings per share for the quarter, beating the consensus estimate of $0.59 by $0.22, Zacks reports. SK Telecom had a net margin of 4.23% and a return on equity of 5.59%. The business had revenue of $3.06 billion for the quarter, compared to analyst estimates of $2.96 billion.

Here are the key takeaways from SK Telecom’s conference call:

• Operating profit rose 67.3% year over year to KRW 566 billion, aided by the absence of last year’s cybersecurity incident costs, while cost controls also supported a 5.3% quarterly increase. Revenue grew 0.5% to KRW 4.36 trillion.
• AI data center revenue increased 92.5% year over year, driven by the Pangyo facility, and construction began on a new Seoul data center. SK Telecom also plans to establish SK Hyper to develop AIDC projects, initially focusing on securing land, power, customers and infrastructure for phased capacity expansion toward 5GW.
• Management expects sustained, structural AI infrastructure demand as inference workloads and enterprise and public-sector adoption expand. It said global customer discussions are ongoing and intends to fund much of the planned AIDC build-out through strategic partners, financial investors and project financing rather than direct investment.
• SK Telecom committed KRW 750 billion to SK Hyper, including KRW 330 billion planned for this year, but said total investment requirements could rise and specific plans remain dependent on customer requirements, business models and schedules. Management maintained a quarterly dividend of KRW 830 per share and reiterated its goal of balancing AIDC investment with financial soundness and stable shareholder returns.
• The company also plans to contribute to SK hynix’s AI investment vehicle through installment payments, seeking access to AI technologies and global partnerships that could strengthen its data center business. Management expects group-level synergies through SK Telecom’s customer network, SK Broadband’s operating expertise and SK hynix’s AI ecosystem investments.

SK Telecom Price Performance

SK Telecom stock traded down $1.20 on Friday, reaching $34.47. The company’s stock had a trading volume of 552,902 shares, compared to its average volume of 2,197,406. The business’s fifty day moving average price is $34.79 and its 200 day moving average price is $33.17. The company has a debt-to-equity ratio of 0.57, a quick ratio of 1.15 and a current ratio of 1.18. The company has a market cap of $13.23 billion, a price-to-earnings ratio of 27.56, a PEG ratio of 0.21 and a beta of 0.64. SK Telecom has a twelve month low of $19.66 and a twelve month high of $47.18.

Analyst Ratings Changes

A number of research analysts have commented on SKM shares. HSBC upgraded shares of SK Telecom from a “reduce” rating to a “hold” rating in a research note on Thursday, May 7th. JPMorgan Chase & Co. raised SK Telecom from a “neutral” rating to an “overweight” rating in a report on Thursday, July 16th. Zacks Research upgraded SK Telecom from a “strong sell” rating to a “hold” rating in a research report on Tuesday, May 26th. Wall Street Zen raised SK Telecom from a “hold” rating to a “buy” rating in a research note on Saturday, July 4th. Finally, Weiss Ratings cut SK Telecom from a “hold (c+)” rating to a “hold (c)” rating in a research report on Wednesday, July 29th. One equities research analyst has rated the stock with a Buy rating, four have issued a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of “Reduce”.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Kestra Advisory Services LLC acquired a new stake in SK Telecom in the 4th quarter valued at about $28,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC acquired a new position in shares of SK Telecom during the fourth quarter worth approximately $30,000. Wexford Capital LP bought a new stake in shares of SK Telecom during the third quarter valued at approximately $39,000. Cubist Systematic Strategies LLC bought a new stake in shares of SK Telecom during the first quarter valued at approximately $85,000. Finally, Osaic Holdings Inc. increased its holdings in shares of SK Telecom by 408.9% in the second quarter. Osaic Holdings Inc. now owns 4,265 shares of the Wireless communications provider’s stock valued at $97,000 after purchasing an additional 3,427 shares in the last quarter.

SK Telecom Company Profile

SK Telecom Co, Ltd. (NYSE:SKM) is South Korea’s largest wireless carrier, offering a comprehensive range of mobile telecommunications services. The company operates 5G, 4G LTE and IoT networks, providing voice, data and messaging solutions to consumers and businesses. Beyond traditional wireless services, SK Telecom delivers fixed-line broadband, digital content platforms, cloud computing and cybersecurity offerings designed to support enterprise digital transformation and the growing demand for high-speed connectivity.

Established in 1984 as Korea Mobile Telecommunications Services, SK Telecom pioneered cellular service commercialization in South Korea and has continually expanded into new technology areas.