SK Telecom (NYSE:SKM) Releases Earnings Results

SK Telecom (NYSE:SKM) announced its quarterly earnings results on Wednesday. The Wireless communications provider reported $0.81 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.59 by $0.22, Zacks reports. SK Telecom had a net margin of 2.03% and a return on equity of 2.78%. The company had revenue of $3.06 billion during the quarter, compared to the consensus estimate 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 Trading Up 0.2%

Shares of SKM opened at $34.88 on Thursday. SK Telecom has a 1-year low of $19.66 and a 1-year high of $47.18. The company has a market capitalization of $13.39 billion, a P/E ratio of 58.14, a P/E/G ratio of 0.21 and a beta of 0.64. The company has a debt-to-equity ratio of 0.57, a current ratio of 1.18 and a quick ratio of 1.15. The firm’s 50 day simple moving average is $34.81 and its 200 day simple moving average is $33.07.

Wall Street Analysts Forecast Growth

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

Hedge Funds Weigh In On SK Telecom

A number of hedge funds and other institutional investors have recently modified their holdings of SKM. Kestra Advisory Services LLC bought a new stake in shares of SK Telecom in the 4th quarter valued at about $28,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC purchased a new position in shares of SK Telecom in the fourth quarter valued at about $30,000. Wexford Capital LP purchased a new stake in shares of SK Telecom during the third quarter worth about $39,000. Cubist Systematic Strategies LLC bought a new position in SK Telecom during the 1st quarter valued at approximately $85,000. Finally, Osaic Holdings Inc. increased its stake in shares of SK Telecom by 408.9% during the second quarter. Osaic Holdings Inc. now owns 4,265 shares of the Wireless communications provider’s stock valued at $97,000 after buying an additional 3,427 shares during the period.

About SK Telecom

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.