KT Corp., South Korea’s leading telecommunications provider, announced a significant drop in its first-quarter operating profit on Tuesday. The telecom giant reported a nearly 30 percent decline year-over-year, primarily due to the absence of one-off property gains recorded in the previous year and increased costs stemming from a recent hacking incident that impacted its financial performance.
For the January-March period, KT Corp. posted a consolidated operating profit of 482.7 billion won (approximately $325 million). This figure represents a 29.9 percent decrease compared to the same quarter last year, as detailed in its latest regulatory filing.
The filing further revealed that KT’s revenue for Q1 slightly dipped by 1 percent year-on-year, reaching 6.78 trillion won. Net profit also saw a substantial decline of 31.5 percent, settling at 388.3 billion won.
Despite the profit downturns, KT’s first-quarter financial results managed to surpass market expectations. Financial data provider FnGuide had projected a lower operating profit of 273.8 billion won and revenue of 4.75 trillion won for the telecom company.
In its key wireless segment, KT experienced a temporary churn in subscribers during the penalty-waiver period in January but successfully returned to net subscriber additions from February onwards. This resilience helped the unit’s service revenue achieve a modest 0.4 percent increase from the previous year.
The company also reported positive growth in its fixed-line services, with revenue rising by 0.8 percent, driven by consistent subscriber growth. Furthermore, internet and media revenue streams saw increases of 1.8 percent and 1.3 percent, respectively, showcasing steady demand in these areas.
Conversely, enterprise service revenue saw a 2.2 percent year-on-year decline. This reduction was attributed to the completion of several large-scale system integration projects, which offset growth observed in emerging areas such as advanced artificial intelligence (AI) contact centers.
Looking ahead, KT Corp. highlighted the progress of its strategic partnerships with global tech leaders Microsoft and Palantir Technologies. The company is actively intensifying its Artificial Intelligence Transformation (AX) business, aiming to leverage these collaborations for future growth.
KT has successfully secured new AX-related contracts, predominantly with financial institutions. The telecom provider plans to strategically expand its innovative AX solutions and services into the finance, public, and manufacturing sectors, fostering broader adoption of its AI capabilities.
In a move to enhance shareholder value, KT also unveiled its comprehensive shareholder return policy for the years 2026 to 2028. Under this plan, the company commits to allocating 50 percent of its adjusted net income (on a separate basis) towards shareholder returns, employing a combination of cash dividends, share buybacks, and share cancellations.
For the current year, KT has established a minimum annual dividend of 2,400 won per share. The first-quarter dividend has been set at 600 won per share, reinforcing its commitment to its investors.
Min Hye-byung, Chief Financial Officer of KT Corp., affirmed the company’s strategic direction, stating, “We are dedicated to pursuing AX-led growth as we evolve into a leading AX platform company. Simultaneously, we are focused on improving overall profitability to significantly enhance corporate value for our stakeholders.”
