Q2 2023 SK Telecom Co Ltd Earnings Call

Speaker 1: Good afternoon, I am Heejun Chung, IIO of SK Telecom. Thank you for joining SK Telecom's earnings conference call.

I'm sorry, my sincere to me the good afternoon, I am a huge chunk of SK telecom. Thank you for joining SK Telecoms earnings conference call.

Hee Jun Chung: Good afternoon. I am Hee Jun Chung, IR of SK Telecom. Thank you for joining SK Telecom's earnings conference call. 오늘 컨퍼런스 콜은 최근에 진행된 주요한 이벤트 그리고 분기 실적, 또 각 사업별 성과 등에 대해서 간략히 말씀드린 후에 Q&A 세션을 갖는 순서로 진행하겠습니다.

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Today, we will first deliver a presentation on major events quarterly earnings highlights and business performances, which will be followed by the Q&A session.

Operator: Today, we will first deliver a presentation on major events, quarterly earnings highlights and business performances, which will be followed by the Q&A session.

Speaker 2: Today we will first deliver a presentation on major events, quarterly earnings highlights, and business performances, which will be followed by the Q&A session.

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Hee Jun Chung: 오늘 이 자리에는 SK텔레콤 CFO 김진원 센터장을 비롯해서 각 사업부별 관련 임원들도 함께 참석하고 있으며, 순차 통역을 통해서 진행될 예정입니다.

The call is attended by our executives from relevant business divisions, including Timberland, Kim CFO of SK Telecom and we're providing consecutive interpretation for the call.

Speaker 2: Call is attended by our executives from relevant business divisions, including Chinwan team, CFO of FK Telecom, and we're providing consecutive interpretation for the call.

Operator: The call is attended by our executives from relevant business divisions, including Jin-won Kim, CFO of SK Telecom, and we're providing consecutive interpretation for the call.

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Hee Jun Chung: 그리고 잘 아시겠지만, 향후의 전망이나 예측과 관련된 사안들은 시장 그리고 매크로 환경 등의 다양한 변수에 따라서 달라질 수도 있다는 점을 미리 말씀드립니다.

As you May know I'd like to remind you that all forward looking statements are subject to change depending on various factors such as market and macro situations Chrome Safeway must meet gives me, though let me now present our CFO .

Operator: As you may know, I would like to remind you that all forward looking statements are subject to change depending on various factors such as market and macro situations.

Speaker 1: As you may know, I'd like to remind you that all forward looking statements or subject to change depending on various factors such as market and echo situations. Let me now present our CO.

Hee Jun Chung: 네, 그럼 CFO의 말씀이 있겠습니다.

Operator: Let me now present our CFO.

SK telecom shape for continuing to do that.

Jin-won Kim: 네, 안녕하십니까. SK텔레콤 CFO 김진원입니다.

Good afternoon. This is <unk> Kim CFO of SK telecom.

Speaker 1: Good afternoon, this is Cinnon Tins, UFO of Esquitella,com.

Operator: Good afternoon. This is Jin-won Kim, CFO of SK Telecom.

Cause I'm on SK telecom on AI company relocation or somebody asks me that it's hanging in order better services to send you a check typically about half of what Amazon Global peak tackled Jeffrey.

Speaker 3: SK Telecom has been leading the AI company revolution. Since the launch of the A.Beta service in May last year, chat GPT has become a hot topic, and global big tech companies have created a global black flow that runs towards AI technology. Various large-scale models and services based on this have been launched competitively.

Jin-won Kim: 그동안 SK텔레콤은 AI company로의 대전환을 선도적으로 추진해 왔습니다. 작년 5월에 A. 베타 서비스를 출시한 이후에 ChatGPT가 화두가 되면서 글로벌 빅테크 기업들이 AI 기술을 향해 달려가는 전 세계적인 큰 흐름이 만들어졌고, 다양한 거대 언어 모델과 이에 기반한 서비스들이 경쟁적으로 출시되었습니다.

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SK telecom has been at the forefront in transforming itself into an AI company. Since we launched <unk> Dot data service in May last year chat GPT has become a hot topic, creating a global rush for AI technology by global Big Tech companies and various large language models and services based on them has been launched competitor.

Speaker 1: SK Telecom has been at the forefront in transforming itself into an AI company. Since we launched A.Data service in May last year, CHAT CPT has become a hot topic, creating a global rush for AI technology by global big tech companies. And various large language models and services based on them have been launched competitively.

Operator: SK Telecom has been at the forefront in transforming itself into an AI company. Since we launched A. beta service in May last year, ChatGPT has become a hot topic, creating a global rush for AI technology by global big tech companies and various large language models and services based on them have been launched competitively.

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Jin-won Kim: 이러한 환경 변화로 AI 기반의 변화와 혁신 없이는 생존이 어렵다는 전 세계적인 공감대가 만들어졌습니다. 이에 SK텔레콤은 자체 LLM 기반의 A. 서비스 고도화 외에도 글로벌 Telco들의 힘을 모아 전방위적인 협력 체계를 구축하고 AI 시장에 함께 액세스하기 위해 지난 7월 말 Global Telco AI Alliance를 출범하였습니다. 이 연합체는 당사를 주축으로 Deutsche Telekom, e&, Singtel 등 유럽, 중동, 아시아를 대표하는 Telco들로 구성되어 있습니다.

Speaker 3: For more information, please visit our website.

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These changes in the business environment has resulted in a shared understanding around the world that companies cannot survive without change in innovation based on AI against this backdrop, while continuing to further advance the AE that service based on its own LLM SK Telecom launched the global Telco AI Alliance.

Operator: These changes in the business environment have resulted in a shared understanding around the world that companies cannot survive without change and innovation based on AI. Against this backdrop, while continuing to further advance the A. service based on its own LLM, SK Telecom launched the Global Telco AI Alliance in late July to build a comprehensive cooperation framework and jointly access AI markets by mobilizing forces of global Telcos. Led by SK Telecom, the alliance consists of major Telcos from Europe, the Middle East, and Asia, including Deutsche Telekom, e&, and Singtel.

Speaker 1: These changes in the business environment have resulted in a shared understanding around the world that companies cannot survive without change and innovation based on AI. Against this backdrop, while continuing to further advance the aid-up service based on its own LLM, Esquitellagon launched the Global Telco AI Alliance in late July to build a comprehensive cooperation framework and jointly access AI markets by mobilizing forces of Global Telcos.

July to build a comprehensive cooperation framework and join me access AI markets by mobilizing forces of global Telcos led by SK Telecom. The alliance consists of major telcos from Europe , the middle East and Asia, including Deutsche Telekom Yen and Singtel.

Speaker 1: Led by SK Telecom, the alliance consists of major telcos from Europe , the Middle East, and Asia, including Deutsche Telecom, Yen, and Sintel.

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Jin-won Kim: Global Telco AI Alliance는 글로벌 시장에서 AI 주도권을 확보하기 위해 다국어 LLM 공동 개발 등의 사업 협력 등을 포함하고 있으며, 메이저 LLM 업체들과의 전략적 협업 등 폭넓은 논의를 통해 Telco 공통의 사업 시너지를 모색해 나갈 계획입니다.

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The global Telco AI Alliance Intel's business cooperation to develop multi lingual LLM jointly to gain leadership in the global market and we will continue to create business synergies through broader discussions, including strategic cooperation with major LLM players.

Operator: The Global Telco AI Alliance entails business cooperation to develop multilingual LLM jointly to gain AI leadership in the global market, and we will continue to create business synergies through broader discussions, including strategic cooperation with major LLM players.

Speaker 1: The Global Telco AI Alliance entails business cooperation to develop multilingual LLM jointly to gain AI leadership in the global market. And we will continue to create business synergies through broader discussions including strategic cooperation with major LLM players.

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Jin-won Kim: 네, 그러면 먼저 2023년 2분기 연결 기준 재무실적에 대해 말씀드리겠습니다.

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Now let me report on the consolidated financial results of Q2 2023.

Speaker 1: Now let me report on the consolidated financial results of Q2 2023.

Operator: Now, let me report on the consolidated financial results of Q2 2023.

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Jin-won Kim: 매출은 유무선 통신과 신사업이 성장하면서 전년 동기 대비 0.4% 증가한 4조 3,064억 원을 기록하였습니다. 이번 분기에 플래그십 단말 출시 공백으로 인해 자회사 단말 매출이 감소하였고, 이러한 영향 등으로 전분기 대비로는 매출이 1.5% 하락하였습니다.

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Consolidated revenue reported four trillion <unk> $306 4 billion, one 0.4% year on year, thanks to the growth of both the fixed and mobile business and the new businesses. It reported a decline of one 5% Q on Q due to the drop in handset sales at the subsidiary company without new flagship handset launch.

Speaker 1: Consolidated revenue reported 4 trillion, 306.4 billion won, up 0.4% year on year, thanks to the growth of both the fixed and mobile business and the new businesses. It reported a decline of 1.5% Q on Q due to the drop in handset sales of the subsidiary company without new flagship handset launch in Q2.

Operator: Consolidated revenue reported KRW 4,306.4 billion, up 0.4% year-on-year thanks to the growth of both the fixed and mobile business and the new businesses. It reported a decline of 1.5% QOQ due to the drop in handset sales of the subsidiary company without new flagship handset launch in Q2.

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Jin-won Kim: 2분기 영업이익은 4,634억 원을 기록하였는데, 이는 매출 성장이 연동되어 전년 동기 대비 0.8% 증가하고, 기타 비용 증가 등으로 인해 전분기 대비 6.4% 감소한 수치입니다.

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The operating income in Q2 posted $463 4 billion, one up <unk>, 8% year on year, thanks to the growth in revenue and down six 4% Q on Q due to the increase in other expenses.

Operator: The operating income in Q2 posted KRW 463.4 billion, up 0.8% year-on-year thanks to the growth in revenue, and down 6.4% QOQ due to the increase in other expenses.

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Jin-won Kim: 당기순이익은 전년 동기 대비 34.8%, 전분기 대비로는 15% 증가한 3,478억 원을 기록하였습니다.

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Net income grew 34, 8% year on year, and 15% Q on Q to come in at $347 8 billion won.

Operator: Net income grew 34.8% year-on-year and 15% QOQ to come in at KRW 347.8 billion.

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Jin-won Kim: 별도 기준 매출은 3조 1,192억 원을 기록하여 전년 동기 및 전분기와 유사한 수준을 유지하였고, 영업이익과 당기순이익은 각각 3,791억 원과 2,728억 원을 기록하였습니다.

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On a non consolidated basis revenue posted 301, three trillion $119 2 billion won which is a similar level Y O Y and Q on Q operating income and net income reported $379 1 billion, one and $272 8 billion one respectively.

Operator: On a non-consolidated basis, revenue posted KRW 3,119.2 billion, which is a similar level YOY and QOQ. Operating income and net income reported KRW 379.1 billion and KRW 272.8 billion respectively. Let me now turn to Q2 business highlights and strategic directions of the company that is pursuing transformation into an AI company. SK Telecom is expanding its AI technology capabilities and services through active collaboration and partnerships with various domestic and foreign AI companies. In June, we released A. 2.0 with a completely revamped UX, added Chat T by utilizing the ChatGPT model, and announced an emotion-based AI agent called A. Friends in collaboration with Scatter Lab. Also, we have upgraded our own large language model for A. 2.0 to support multi-turn conversations where the model understands the context and intentions. With this enhancement, A. is evolving as a more user-friendly conversational AI service.

Commodore AI component of our transformation journey.

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Let me now turn to Q2 business highlights and strategic direction of the company that is pursuing transformation into an AI company.

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SK telecom is expanding its AI technology capabilities and services through active collaboration and partnerships with various domestic and foreign AI companies in June we released a dot 2.0 with a completely revamped UX added chatty by utilizing the chachi PT model and announced an.

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Also we have upgraded our own large language model for $8 2.0 to support multi turn conversations where the model understands the context any intentions with this enhancement a dot is evolving as a more user friendly conversational AI service.

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With global launch in November last year, Eastland has attracted more than 30% of Mou from overseas. It is expanding the scope of global cooperation with various foreign companies, including Deutsche Telekom T Mobile U S and sing Tel.

Operator: With global launch in November last year, ifland has attracted more than 30% of MAU from overseas. It is expanding the scope of global cooperation with various foreign companies, including Deutsche Telekom, T-Mobile US, and Singtel. After a new type of metaverse social media feature called if home was released in May, a total of more than 400,000 if homes were created as of the end of July, taking the ifland service to the next level. We're well on our way to introduce an economic system based on in-app payments in late September. The global expansion of ifland and popularity of if home are expected to be a big help in operating this revenue model. With MAU exceeding 2 million in Q2, T Universe has further strengthened its competitiveness based on partnerships with big players such as YouTube Premium.

After a new type of meta versus social media feature called if home was released today a total of more than 400000. If homes were created as of the end of July taking the <unk> service to the next level.

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We're well on our way to introduce an economic system based on in our payments in late September the global expansion of Eastland and popularity of his home are expected to be a big help in operating this revenue model.

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With <unk> exceeding 2 million in Q2 T Universe has further strengthened its competitiveness based on partnerships with big players such as Youtube premium.

It will continue to expand the list of impactful partners and increase the share of voluntary sign up channels with higher customer retention rates through compelling product partnerships.

Operator: It will continue to expand the list of impactful partners and increase the share of voluntary sign-up channels with higher customer retention rates through compelling product partnerships. SK Telecom has acquired approximately 2% stake in Joby Aviation, a global number one UAM manufacturer, with $100 million equity investment. The investment will allow exclusive use of their aircraft in Korea, UAM related technology cooperation, and joint entry into overseas markets to create synergies in diverse areas, which will help solidify our leadership in the UAM industry. The enterprise business is maintaining a stable revenue in the lease line business while showing a noticeable growth trend in data center and cloud businesses.

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SK Telecom has acquired approximately 2% stake in <unk> aviation, a global number one <unk> manufacturer with $100 million equity investment the.

The investment will further will allow exclusive use of their aircrafts in Korea, UA and related technology cooperation and joined entry into overseas markets to create synergies in diverse areas, which will help solidify our leadership in the UAE industry.

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The enterprise business is maintaining a stable revenue in the lease line business, while showing a noticeable growth trends in data center and cloud businesses.

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The data center business sustained the revenue growth trend of more than 30% year on year. Thanks to a stable increase in the utilization rate of cotton and <unk> data centers and the opening of pin down to a center as the business expansion of global Cps is in Korea is leading to the growth in demand for data centers preparations to open.

Operator: The data center business sustained the revenue growth trend of more than 30% year-on-year, thanks to a stable increase in the utilization rate of Gasan and Siksa data centers, and the opening of Bundang 2 center. As the business expansion of global CSPs in Korea is leading to the growth in demand for data centers, preparations to open new data centers, including securing sites, are well underway.

New data centers, including securing sites are well underway.

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Jin-won Kim: cloud 사업도 매출이 전년 동기 대비 60% 이상 상승하면서 연간 목표를 무난하게 달성할 것으로 예상하고 있으며, 특히 AI 서비스와 hybrid cloud 시장 확대에 따른 수혜로 추가적인 성장이 기대됩니다. 특히, 2분기에는 smart ship 구축, 게임, 금융 사업 수주 등이 있었고, 현재는 big account 중심의 다양한 추가 수주 기회를 모색하고 있습니다.

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The cloud business is expected to be on track to meet its annual target with its revenue growing more than 60% year on year additional growth as expected as we benefit from the expanding market for AI services in hybrid cloud in the second quarter, we secured orders for smart chip development as well as gaming and finance.

Operator: The cloud business is expected to be on track to meet its annual target with its revenue growing more than 60% year on year. Additional growth is expected as we benefit from the expanding market for AI services and hybrid cloud. In Q2, we secured orders for smart ship development as well as gaming and financial businesses. We're currently exploring additional business opportunities focused on big accounts.

Businesses were currently exploring additional business opportunities focused on big accounts.

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Jin-won Kim: SK Telecom은 다양한 고객 니즈에 맞춰 올해 상반기 총 25종의 5G 신규 요금제를 출시하였고, 특히 시장에서 큰 호응을 얻고 있는 0 청년 요금제 출시를 통해 젊은 고객층에 대한 retention을 계속 강화해 나가고 있습니다. 이러한 성과를 바탕으로 2분기 말 기준 당사 5G 가입자 수는 1,467만 명을 기록하였습니다.

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To meet diverse needs of customers SK Telecom introduced 25, new <unk> price plans in the first half of the year in particular zero youth plan has been well received by the market, helping us continue to strengthen our retention of younger customers. Thanks to these achievements the number of <unk> subscribers.

Operator: To meet diverse needs of customers, SK Telecom introduced 25 new 5G price plans in H1. In particular, 0 Youth Plan has been well received by the market, helping us continue to strengthen our retention of younger customers. Thanks to these achievements, the number of 5G subscribers reached 14.67 million as of the end of Q2.

Reached $14 six 7 million as does the end of Q2.

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Jin-won Kim: 한편, 6월 말 현재 SK Broadband의 유료방송 가입자 수는 946만 명, 초고속 인터넷 가입자 수는 681만 명을 기록하였습니다. SK Broadband은 상반기 유선 시장에서 IPTV 및 초고속 인터넷 순증 MS 1위를 달성하며 가입자 성장을 지속하였으며, 앞으로도 1인 가구 및 second TV 시장뿐만 아니라 B2C, B2B가 혼재된 niche market을 적극 공략하면서 추가 성장을 이어나갈 계획입니다.

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As of the end of June the pay TV subscribers and broadband subscribers of SK broadband reached $9 $4 6 million and $6 $81 million, respectively. We continue to grow the subscriber base by achieving number one net adds were IP TV and broadband in the first half of the year, we're planning to pursue additional.

Operator: As of the end of June, the pay TV subscribers and broadband subscribers of SK Broadband reached 9.46 million and 6.81 million respectively. We continue to grow the subscriber base by achieving number 1 net adds for IPTV and broadband in the H1 of the year. We're planning to pursue additional growth by actively targeting niche markets mixed with B2C and B2B, as well as continuously expanding in the single person household and second TV markets.

Growth by actively targeting niche markets mixed with B to C and b to B as well as continuously expanding in the single person households, and second TV markets.

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Jin-won Kim: 마지막으로 주주 환원에 대해 말씀드리겠습니다.

Finally, let me report on our shareholder return policy.

Operator: Finally, let me report on our shareholder return policy.

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Jin-won Kim: 금번 이사회에서 2분기 배당금은 지난 분기와 동일한 주당 830원으로 확정하였습니다.

Smith.

The board determined in the second quarter EPS to be the same as the previous quarter at 831.

Operator: The board determined the Q2 DPS to be the same as the Q1 at KRW 831.

Forget all year SK telecom on until the camera Assembly row open to Joanne on updated you're gonna Tony So I'm kind of looking where it has had an equal eternal when silver gold characterized me that.

Jin-won Kim: 거기에 더하여 SK Telecom은 연초부터 투자자 여러분께 말씀드려왔던 주주 환원 확대를 이행하는 차원에서 3,000억 원 규모의 자사주 매입과 2,000억 원 소각을 결정하였습니다.

Furthermore, we decided to buy Treasury shares of all 300 billion won and canceled 200 billion worth of shares in order to fulfill the increased shareholder return that we have been communicating to our investors since the beginning of the year.

Operator: Furthermore, we decided to buy treasury shares of KRW 300 billion and cancel KRW 200 billion worth of shares in order to fulfill the increased shareholder return that we have been communicating to our investors since the beginning of the year.

Thanks, Anand from gifting in AI company ready for your call. It 100 per game AI servicer, Ocado uncle Colgate in EMEA similar to what Melissa Congo pivotal continues to deliver cardiovascular koukiadis withdraw a product chest on our targets.

Jin-won Kim: 당사는 본격적인 AI company로의 도약과 전환을 통해 AI 서비스를 고도화하고, core business의 효율성을 제고함으로써 궁극적으로 기업 가치 및 주주 가치가 극대화될 수 있도록 앞으로도 최선을 다하겠습니다.

We will continue to do our best to ensure that corporate value and shareholder value will be maximized by making our core businesses more efficient and advancing our AI services through transformation into an AI company.

Operator: We will continue to do our best to ensure that corporate value and shareholder value will be maximized by making our core businesses more efficient and advancing our AI services through transformation into an AI company.

And then instead of an introductory question guar someone reputable Demeter comes on.

Jin-won Kim: 투자자와 애널리스트 여러분의 지속적인 관심과 성원을 부탁드립니다. 감사합니다.

We ask for your continued support and encouragement. Thank you.

Operator: We ask for your continued support and encouragement. Thank you.

The chrome chicken Vitol Q&A session Restock Kroger Smith.

Jin-won Kim: 네, 그럼 지금부터 Q&A 세션을 시작하도록 하겠습니다.

We will now begin the Q&A session begin with TD and debate I guess meter qimonda.

Operator: We will now begin the Q&A session.

Operator 2: 지금부터 질의응답을 시작하겠습니다. 질문을 하실 분은 전화기 버튼의 별표와 1번을 눌러주시기 바랍니다. 질문을 취소하시려면 별표와 2번을 눌러주시면 됩니다. Q&A session will begin. Please press star 1, that is star and 1 if you have any questions. Questions will be taken according to the order you press the number star 1. For cancellation, please press star 2, that is star and 2 on your phone. 처음으로 질문해 주실 분은 이베스트투자증권의 이승웅 님입니다. The first question will be presented by Seung Woong Lee from eBEST Investment & Securities. Please go ahead with your question.

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The largest human Demeter.

Now Q&A session will begin please press star one that is star one if you have any questions.

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Alicia Please press star two star and two on your phone.

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Question will be presented by Susan Lee from <unk> investment Securities. Please go ahead with your question.

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Seung Woong Lee: 네, 안녕하세요. 이베스트투자증권 이승웅입니다. 일단 질문 두 가지 있고요. 첫 번째 같은 경우는 자사주 방금 말씀해 주셨는데 일단은 자사주 같은 경우는 올해 3천억 자사주 매입 하시고 2천억 소각하신다고 하셨고, 혹시 내년에도 이러한 기조가 계속될 수 있는지 궁금하고요. 또 하나는 아무래도 자사주 매입과 소각이 진행되다 보니까 현금 배당에 대한 영향이 있는지 좀 궁금합니다. 그리고 두 번째 질문은 AI와 관련된 얘기를 계속해 주시는데 최근에 뉴스 보면 Global Telco AI Alliance를 출범을 한 걸로 알고 있고요. 그거에 대한 배경이랑 계획, 효과 같은 것들을 설명해 주시면 감사하겠습니다. 감사합니다.

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I am <unk> from <unk>. Thank you for this opportunity I would like to ask you two questions first of all you mentioned that you are going to purchase Treasury shares worth 300 billion won and retired 200 billion one of all the treasury shares for this year. So I Wonder if you will continue to do so next year or going forward.

Operator: I am from eBEST. Thank you for this opportunity. I would like to ask you two questions. First of all, you mentioned that you are going to purchase treasury shares worth KRW 300 billion and retire KRW 200 billion of treasury shares for this year. I wonder if you will continue to do so next year or going forward. I wonder if there is going to be any impact of such action on your cash dividend. Secondly, you've been talking about your AI related plans and the news media reported on the launch of the Global Telco AI Alliance recently. I'd like to understand the background behind this alliance and the future plans and expected benefits. Thank you for the questions. I would like to first address your question regarding our plan for treasury shares, and secondly, responding to your question on the Global Telco AI Alliance.

And I Wonder if there is going to be any impact of such action on your cash dividend second.

Secondly, you've been talking about your AI related plans and the news media reported on the launch of the global Telco AI Alliance recent knee, so I'd like to understand the background behind this alliance and our future plans and expected benefits.

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Thank you for the questions I would like to first address your question regarding our planned for Treasury shares and secondly, responding to your question on the global Telco AI Alliance.

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Operator: There were questions related to our potential share buyback and cancellation at the first quarter earnings call as well as the year-end earnings call. We mentioned that we are positively considering the option of share buyback and cancellation, but we did not specify the specific timing or the size of such action. The board in July decided that we are going to purchase KRW 300 billion worth of treasury shares and cancel KRW 200 billion of them going forward. While macro uncertainties are still present, including interest rate hikes and economic downturn, the board agreed that it was necessary to enhance corporate value through additional shareholder return, which is why we decided to go ahead with share buyback and cancellation.

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There were questions related to our potential share buyback and cancellation at the first quarter earnings call as well as the year end earnings call and we mentioned that we are.

Positively considering the option of share buyback and cancellation, but we did not specify the specific timing or the size of such action.

And the board in July decided that we are going to purchase 300 billion won worth of Treasury shares and canceled 200 billion one of them going forward.

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While macro uncertainties are still present, including interest rate hikes and economic downturn. The board agreed that it was necessary to enhance corporate value through additional shareholder return, which is why we decided to go ahead with share buyback and cancellation.

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I understand that the market is interested in whether we will continue to go in this direction next year and going forward and we understand that there are many companies who continue to purchase and retire treasury shares to enhance corporate value and such measures has been well received in the market. In addition, we have these stable.

Operator: I understand that the market is interested in whether we will continue to go in this direction next year and going forward, and we understand that there are many companies who continue to purchase and retire treasury shares to enhance corporate value, and such measures have been well received in the market. In addition, we have the stable operating cash flow, and we are starting to receive dividends from SK Broadband and the invested companies this year and onward, which can be used as funds for share buyback in the future. Against this backdrop, we will seriously and positively consider the option of continued share buyback and cancellation going forward. Of course, regarding details concerning timing and size of share buyback and cancellation, these need to be determined at the board through discussions and in consideration of the overall business environment.

Operating cash flow and we are starting to receive dividends from SK broadband and invested companies this year and onward, which can be used as funds for share buyback in the future.

Because our product intelligent vehicles, however, during the cutover and opinions I hear this in conjunction.

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Against this backdrop, we will seriously and positively consider the option of continued it continued share buyback and cancellation going forward of course regarding details concerning timing and size of share buyback and cancellation. These need to be determined at the board through discussions and in consideration of the overall business environment, but we will.

You need to accumulate market for a new practice around shareholder return to show the market that the company has a strong commitment to increasing corporate value.

Operator: We will continue to accumulate market-friendly practice around shareholder return to show the market that the company has a strong commitment to increasing corporate value. Regarding its potential impact on our cash dividend, as you know, we are already practicing a dividend policy in line with global standards by paying out quarterly dividends to our shareholders. Therefore, this decision for share buyback was, of course, to increase the total size of shareholder return, and this has been our practice since the spin-off, and we're committed to the direction and principle of maintaining a stable cash dividend level.

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Hi, gentlemen.

And regarding its potential impact on our cash dividend as you know we are already practicing a dividend policy in line with global standards by paying our quarterly dividend to our shareholders.

Therefore, the the this decision for share buyback was of course to increase the total size of shareholder return and this has been our practice since the split off since the spinoff and we're committed to the direction and principle of maintaining a stable cash dividend level.

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Jeong Seok-geun: 전반적인 AI의 전략 방향에 대한 고민들, 그리고 그런 내용들이 구체화되면서 시장에 여러 가지 뉴스 플로우들이 나오고 있는데, 최근에 있었던 Global Telco AI Alliance에 대해서는 Global Telco AI Alliance를 직접 주도하고 계시는 우리 정석근 Global AI Tech 사업 담당께서 추가적으로 설명을 해주시겠습니다.

It isn't.

Global pet ligand sort of ticked up to August you done in terms of going global Texas hub, sometimes peso together with someone else.

Yeah.

Moving onto your second question on our AI related vision since last year within talking about our vision of transforming SK telecom into an AI company and we have been launching various services, including a dot to test the market and there have been many news announcements about specific strategies Andy.

Operator: Moving on to your second question on our AI related vision. Since last year, we've been talking about our vision of transforming SK Telecom into an AI company, and we have been launching various services, including A., to test the market. There have been many news announcements about specific AI strategies and detailed plans. Regarding your question on the Global Telco AI Alliance, I'd like to ask Mr. Jeong Seok-geun, Head of Global AI Tech Business Division, who has been leading this initiative to provide you with more details.

Tailored plans and regarding your question on the global Telco AI Alliance I'd like to ask Mr. Tomaso Gunn head of global AI Tech business Division, who has been leading this initiative to provide you with more details.

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Jeong Seok-geun: 최근 웹이나 모바일에서 AI로 큰 패러다임이 변하고 있는 것들을 여러분들 많이 알고 계실 것 같습니다. 특히 생성형 AI를 얼마나 잘 쓰느냐가 회사들의 밸류나 고객과의 관계 설정에 굉장히 중요한 모멘텀이 되고 있고요. 그래서 그러한 것들을 보면 과거에 통신사들은 지난 20년 동안 모바일이나 혹은 그전에 인터넷이나 이런 흐름이 올 때마다 저희가 갖고 있는 여러 가지 고객과의 접점이라고 하는 장점을 잘 활용하지 못하고, 인터넷 사업자 혹은 모바일 사업자들에게 굉장히 많은 고객과의 접점, 고객에 대한 헤게모니를 많이 뺏겨 온 것 같습니다. 그래서 이번에 이 생성형 AI의 성장을 통해서 저희가 다시 한번 과거와 같은 실수를 하지 않고, 실패를 하지 않고, 이 AI를 좀 더 잘 활용하는 그런 사업 변화에 대한 니즈가 크게 있습니다.

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As you May know very well the tech paradigm is being shifted from web and mobile to AI, especially generative AI.

Operator: As you may know very well, the tech paradigm is being shifted from web and mobile to AI, especially Generative AI. For the past 20 years, whenever there was such a tech paradigm shift from the internet to mobile, many telcos failed to maintain their points of contact with customers, and they have lost the hegemony and leadership to internet companies and mobile companies. In this regard, in preparation for this new era of Generative AI, we are taking action preemptively so that we can utilize AI for our business enhancement.

Oh for the past 20 years whenever there was such a paradigm shift from the Internet to mobile many telcos failed to maintain their points of contact with customers and they have lost the hegemony leadership to internet companies and mobile companies in this regard in preparation for this new era of generative AI we are.

Taking action preemptively, so that we can utilize AI for our business enhancement.

No.

And could you just don't know.

Jeong Seok-geun: AI 기술은 기존의 여러 가지 산업에 들어가서 효율을 높여주는 걸로 큰 밸류를 만들 수 있는데요. 통신사들의 경우에는 전 세계적으로도 정말 많은 고객을 가지고 있고, 특히 고객들은 유료 고객들이기 때문에 이들과의 관계 설정, 그들에 대한 서비스에 대한 난이도가 굉장히 높은 사업자라고 볼 수 있습니다. 그래서 AI를 통해서 내부 사업의 운영 효율을 한다든지, 혹은 이걸 잘 활용해서 고객과의 관계를 바꾼다든지 했을 경우에 AI를 가지고 가장 큰 수혜, 가장 큰 밸류를 만들 수 있는 industry가 이 Telco 산업이라고 저희는 이해를 하고 있습니다. 그래서 저희가 만약에 이런 가장 난이도가 있는 산업에서 성공적으로 AI를 적용한 transformation을 만들어낼 경우에, 저희 산업 자체에서 큰 밸류를 만들 수 있는 것뿐만 아니라, 이걸 가지고 다른 산업에서도 활용이 가능할 수 있는 플랫폼이라든지, 레퍼런스를 만들고 이를 사업화까지 할 수 있겠다고 생각을 하고 있습니다.

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Okay, you don't have them in Canada as well as in Guangzhou.

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We understand that AI technology can enhance value in a diverse number of industries, but when it comes to the telecommunications industry telcos around the world has the largest customer base and these customers are paying customers and theres a high level of customer relations management and customer service. Therefore.

Operator: We understand that AI technology can enhance value in a diverse number of industries. When it comes to the telecommunications industry, telcos around the world have the largest customer base, and these customers are paying customers. There's a high level of customer relations management and customer service. Therefore, we understand that telecommunications industry can benefit the most from using AI by increasing their business efficiency and innovating their customer relations. In this regard, if we can successfully use AI and go through AI transformation in this particular telecommunications industry that has the highest level of difficulty in managing the customers, we believe that we can prove the value of using AI. We can apply these references to other industries by providing platforms and successful references.

We understand that telecoms telecommunications industry can benefit the most from using AI by increasing their business efficiency and innovating their customer relations. In this regard if we can successfully use AI and I'll go through a transformation in this particular telecommunications industry that has the highest.

Will have difficulty in managing their customers. We believe that we can prove the value of using AI and we can apply these references to other industries by providing platforms and successful references.

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Jeong Seok-geun: 특히나 최근에 이 AI 변화에서 가장 큰 변화라고 보면 LLM 기술의 potential이 크다는 거고요. 그래서 이거에 대한 수요가 굉장히 늘었는데, 이 LLM 기술 자체가 글로벌 빅테크들을 중심으로 주로 이루어지고 있고, 특히 이걸 잘 활용해야 되는 저희 Telco들은 이 기술을 많이 확보하기 어려운 그런 현실에 있습니다. 그래서 저희 SK Telecom은 지난 몇 년 동안 AI에 대해서 굉장히 많이 투자를 해오기도 했고, 저희가 이걸 주도해서 글로벌의 많은 통신사들을 묶어서 Alliance를 만들고, 이걸 통해서 규모의 경제를 만들고자 합니다.

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Jeong Seok-geun: 그래서 첫 번째는 이 규모의 경제를 통해서 글로벌 빅테크 기업들을 대비해서 규모를 통한 협상력을 확보할 수 있다고 보고 있고, 두 번째는 저희가 기존에 갖고 있던 자체적인 LLM 기술 기반을 가지고 이 Telco들이 잘 활용할 수 있는 AI 플랫폼, 그리고 저희가 Telco들을 위한 여러 가지 LLM 기술 자체 개발, 그리고 마지막으로는 이들이 활용할 수 있는 AI 어시스턴트 서비스, 이런 것들을 만들어서 제공함으로써 Telco들이 이 LLM이라는 흐름에 쉽게 참여할 수 있도록 그런 연합체를 만들고 있다고 말씀드릴 수 있겠습니다.

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Yeah.

In the <unk> industry, we are seeing a great potential of utilizing LLM and there's growing demand for large language models.

Operator: In the AI industry, we are seeing a great potential of utilizing LLM, there is growing demand for large language models. Currently, the large language model technology has been led mainly by global big tech companies, which means that telcos are struggling to secure LLM-related technology. As you may know, SK Telecom has been making investments in AI for the past couple of years. We believe that we can lead this particular alliance with global telcos so that we can gain the economies of scale. By doing so, we can strengthen the negotiating power of the telcos as part of the alliance, and we can use our own LLM technology to build AI platforms for global telcos, develop LLM technologies together, and provide AI assistant services for telcos to utilize. In this way, we can help telcos around the world to utilize LLM more successfully.

Currently the large language model technology has been led mainly by global Big Tech companies, which means that telcos are struggling to secure LLM related technology.

As you May know SK telecom has been making investments in AI for the past couple of years. So we believe that we can lead on this particular alliance with global telcos. So that we can gain the economies of scale by doing so we can strengthen the negotiating power of the telcos as part of the alliance and we can use our own.

L M technology to build AI platforms, where global telcos develop LLM technologies, together and provide AI assistant services for telcos to utilize and in this way we can help telcos around the world to utilize L. L. M. More successfully this is the purpose of this alliance cause from typical children's women's or these things on it.

Operator: This is the purpose of this alliance.

Jeong Seok-geun: 그래서 좀 더 구체적으로는 통신사들이 이 Generative AI 기술을 이용해서 기존에 하고 있던 operation들의 효율화를 꾀할 수 있을 것 같고요. 그래서 이를 통해서 마케팅이나 네트워크 관리, 아웃소싱 효율화 등을 통해서 비용 절감, cost reduction을 첫 번째 할 수 있을 것 같고, 그 외에도 AI Assistant 서비스를 통해서 기존의 고객과의 관계를 새로 설정하고, 이들을 통한 새로운 비즈니스 모델을 확보할 수 있을 것으로 기대합니다.

Similar to a year ago.

It's hard because you're in a way to operate under.

So we would rather it appears you took up your blue tomato market.

Clearly also seen who rather than it's all films work on cost reduction.

Okay cool.

Oh assistant to service certain Mirasol units will get caught up on guitar hero searching around for either at home on her own Producible dinner a policy circles Rotterdam.

It would be more specific the telcos in the airlines will be able to utilize degenerative AI based AI transformation to increase efficiency in their marketing network management and outsourcing and they can further develop new business models, using AI assistance and innovate the customer experience.

Operator: To be more specific, the telcos in the alliance will be able to utilize the Generative AI-based AI transformation to increase efficiency in their marketing, network management, and outsourcing, and they can further develop new business models using AI assistance and innovate the customer experiences.

D&C costs either.

What are your MW. She you had stopped.

Jeong Seok-geun: 그래서 이를 위해 지난 올해 2월 MWC 이후에 지속적으로 논의를 해왔던 주요한 통신사들 중에 유럽이나 중동, 아시아를 가장 대표하고 많은 고객과 자회사들을 가지고 있는 대표적인 통신사들과 Founding Member들로 해서 저희가 이번에 Alliance를 결성했습니다. 그들은 Deutsche Telekom, e&, Singtel 등이고요. 그들과 MOU를 맺고 이를 실제로 실행하기 위해서 필요한 어떤 공동 투자라든지, 이런 것들을 함께 하기 위한 논의들을 지속하고 있고, 이 외에도 그들의 자회사, 그리고 그 외에 선진국 시장 중심으로 주요한 통신사들 중심의 2차 파트너 멤버를 모집하고 규모 확대를 하기 위한 논의들을 진행하고 있습니다.

On to Anthony's other junior Eurovignette Dream Donuts.

I don't have turbo modern could get.

Because you wouldn't anticipate yoga and Thompson's or they require a founding member of the law and so on so you Wanna alone should cause I mean assume that just because they didn't push telecom media and she can tell or do you feel as though because they require a modem. It cool I'll use shoot journal. She Didnt argue is all people I don't think I'm going to.

Jonathan G. You don't go through I'm curious I'll give you a little color equal you able because the retailers are pretty good.

Yes.

Junk junes funeral homes and the other deals you may each of autonomy and border would you publicly update I'll give you an do neither.

Discussions for the formation of such an alliance began since February when we attended the NW seats, and we decided to join hands with a leading telco companies, representing Europe Asia and the Middle East.

Operator: Discussions for the formation of such an alliance began since February when we attended the MWC, and we decided to join hands with the leading telco companies representing Europe, Asia, and the Middle East. They participated as the founding members. They include the Deutsche Telekom, e&, and Singtel. We signed an MOU together, and we are currently carrying out discussions on various issues, including joint investments. We will further invite other telcos to join us, and we're going to utilize their subsidiaries and the advanced markets so that we can increase the size of the alliance.

They participated at the founding members. They include the Deutsche Telekom, Ian and Singtel, We signed an Mou together and we are currently carrying out discussions on various issues, including joint investments and we will further invite other telcos to join us and we're going to utilize their subsidiaries and the advanced markets.

So that we can increase the size of the alliance.

There's really three or four airlines for 10 years or so you didn't acquire.

Jeong Seok-geun: 네, 그래서 이 Telco AI Alliance를 통해서 저희는 Telco AI Platform과 LLM을 만들어 갈 거고, 이걸 바탕으로 여러 가지 AI 서비스를 만들고, 이걸 글로벌 서비스 및 각 Telco들이 각국에서 현지화, 고도화해서 로컬 서비스들도 만들어 갈 예정입니다. 그래서 이걸 구체화하기 위해서 지난 Alliance CEO Summit 이후에 향후 공동 워킹그룹 운영을 통해서 Governance 구조나 사업 기획 그리고 개발 방안을 구체적으로 논의하려고 하고 있고요. 그래서 이를 위해 각 사들이 C레벨 임원들을 중심으로 운영 책임자를 정해서 여러 가지 협력을 논의하고 있습니다.

Well it did.

Under a vertical where you're going to have a total you Roger it's obviously macdougall Ya global Soapy Smith.

Total quiddity, Google turned you off with oil sort of course, obviously, the law and the local region.

Could you all give yourselves.

So she has so many of you in the working group.

We know, we're telling us all covenants could join US health care budget per month to one year ago.

But we.

I'm sorry that he should have already won virtually zero, we don't take them doesn't mean, it's all over.

Sure.

Yeah.

Through the global Telco AI Alliance, we will develop the telco AI platform and large language model. So that we can offer a diapers AI services, which can be provided at the global level and also localized and further advance.

Operator: Through the Global Telco AI Alliance, we will develop the Telco AI Platform and large language model so that we can offer diverse AI services which can be provided at the global level and also localized and further advanced for the respective local markets. The Global Telco AI Alliance, ever since the CEO Summit, will create the joint working group to discuss specific matters related to governance, business plan, and development direction. C-level executives will be designated for this alliance so that they can pursue extensive cooperation. Thank you.

For their respective local markets and the global Telco AI alliance ever since the CEO summit.

We'll create the joint working group to discuss specific matters related to governance and business plan and development direction and C level executives will be designated for this alliance so that they can pursue extensive cooperation.

<unk>.

Tom a routine and educate patients in coronary accumulated you mean EBITDA.

Operator 2: 다음으로 질문해 주실 분은 대신증권의 김회재 님입니다. The following question will be presented by Hoi-jae Kim from Daishin Securities. Please go ahead with your question.

Following question will be presented by Jae Kim from <unk> Securities. Please go ahead with your question.

No the only thing I will cause any confusion.

Hoi-jae Kim: 네, 안녕하세요. 대신증권 김회재입니다. 두 가지 질문이고요. 첫 번째는 정부의 통신 시장 경쟁 촉진 방안 발표와 관련해서 궁금한 사항이 있는데, M&A 시장이 확대되는 그런 상황에서 우리 SK Telecom의 M&A 사업에는 어떤 영향이 있을지 궁금하고요. 두 번째는 T Universe에 최근에 YouTube Premium을 선택할 수 있는 옵션이 추가된 것으로 알고 있습니다. 이 YouTube Premium 출시 이후에 T Universe 성과랑 향후 전망에 대해서 말씀해 주시면 감사하겠습니다.

So that is removed.

One thing.

Congress comes in Poland, That's all I needed.

And then of course.

How long until we get the clinical need and then I'll tell them and I'll pick on them.

Well the one thing.

T O G check I think the Youtube premium or something for a single person.

Oh Youtube premium tissue.

Just some color on how much of a manganese in isolation.

Yeah.

I am in key major Foundation Securities. Thank you for this opportunity I have two questions first of all the government recently announced plans to promote competition in the telecommunications industry as the immuno market has been growing I wonder what kind of impact. These government announcements will have on your <unk> business going forward.

Operator: I am Kim Hoeja from Daishin Securities. Thank you for this opportunity. I have two questions. First of all, the government recently announced plans to promote competition in the telecommunications industry. As the M&A market has been growing, I wonder what kind of impact these government announcements will have on your M&A business going forward. Secondly, the YouTube Premium has been added as an option for T Universe subscription. I'd like to know the impact of such addition of YouTube Premium on T Universe, and its outlook going forward.

And secondly on the Youtube premium has been added as an option for T universe subscription so I'd like to know the impact of such addition of Youtube premium on T universe, and its outlook going forward.

Struggled somewhat in.

Jin-won Kim: 최근에 정부가 발표한 경쟁 촉진 방안의 시행과 관련된 영향에 대해서 먼저 말씀을 드리겠습니다.

In parallel in a single a then young.

It hasn't been just last month.

Thank you for the question, let me first address your question on the impact of the government's decision to promote competition in the industry.

Operator: Thank you for the questions. Let me first address your question on the impact of the government's decision to promote competition in the industry.

And until you got the priority service to the initiative that stuck on your table.

Jin-won Kim: 저희가 5G 서비스를 시작한 이래 보면, 5G 가입자가 늘어나면서 이용자의 선택권과 혜택을 확대한다.

Got it.

Young Davidson. Please go ahead.

Cheers.

I wanted to take the pension funds.

Jin-won Kim: 라는 취지에서 여러 가지 방안들을 저희가 발표를 해왔고요. 또 한편으로 보면 시장의 경쟁을 리드하는 측면에서 저희들이 여러 가지 요금제를 내왔습니다. 코로나 시기에 저희가 저렴한 언택트 요금제도 출시하였고, 작년 8월과 올해 초에 이용자의 선택권을 크게 늘리는 다양한 5G 요금제에 앞장서면서 저희가 5G 저변을 넓혀왔다고 생각합니다.

Continental and she's going to come to England redone in two of them as I'll tell you that.

You won't get rid of them they must be them a corner here.

So you got to remember on pick two you won't get the cool part of our what are true human Jason take one or two candidly, none I would you're going to have on fiber Jurgen J F 10, central opt ins that Mr. You've got fiber Chi children.

Oh, it's in Colombia.

Since the launch of <unk>, a number of <unk> subscribers has been on the rise and we have been leading market competition by announcing measures to expand benefits and choices for users. During the pandemic. We were the first company to launch the most affordable on Tech price plan and we added more of <unk> price plans in August last year and early this year to offer.

Operator: Since the launch of 5G, the number of 5G subscribers has been on the rise, and we've been leading market competition by announcing measures to expand benefits and choices for users. During the pandemic, we were the first company to launch the most affordable untact price plan, and we added more 5G price plans in August last year and early this year to offer more choices for customers, which has been helping growing the 5G market.

There are more choices for customers customers, which has been helping growing of Iot market.

Well you don't get until you got into trouble and Colgate Center Couldnt go ahead.

Jin-won Kim: 이렇게 저희가 차별적인 고객 선택권과 혜택을 넓히는 한편으로 5G 고객 기반을 크게 확보해 왔는데, 이를 통해서 저희들은 이용자의 후생 증진과 정부의 민생 안정 정책에도 기여했다고 생각합니다. 지난 7월 발표된 정부의 통신 시장 경쟁 촉진 방안 역시, 이런 통신사들의 서비스 품질 경쟁을 통한 이용자 편익의 증진을 추구한다는 점에서 저희가 그동안 추구해 왔던 선도적 경쟁을 통해서 추구한 가치와 궤를 같이 한다고 생각합니다.

Hum.

I cannot control.

Private vehicles get coupon.

You don't want me to tell you that on younger whose engines, England somewhere.

I'm just.

I'm curious.

To learn about it and Tom will then tell me if you don't change Duncan talked in kind of your cheek since you've been tweaking some of it is service the country kind of giving you an opinion.

Two Gander mountain itself.

They want to work on Sunday, the campaign with clean itself won't cut Chiller theatre catch on that wasn't going to be.

Based on the differentiated customer choices and benefits we have secured a large five G subscriber base and contributed to the government's effort to stabilize the likelihood of the public by enhancing the welfare of the customers. The government's announcement in July to promote competition in the telecom market is in line with the company's value.

Operator: Based on the differentiated customer choices and benefits, we have secured a large 5G subscriber base and contributed to the government's effort to stabilize the livelihood of the public by enhancing the welfare of the customers. The government's announcement in July to promote competition in the telecom market is in line with the company's value pursued through market leadership, in that it aims to enhance user benefits and convenience through service quality competition among the telcos.

Pursued value pursued through market leadership and that it aims to enhance user benefits and convenience through service quality competition among the telcos.

Okay.

Jin-won Kim: 정부가 발표한 신규 사업자의 도입이라든지, 알뜰폰 시장과 같은 여러 가지 정책들, 각각에 대해서 여러 가지 이야기를 할 수 있겠지만, 일정 부분은 저희 당사 매출에도 영향을 미칠 가능성을 배제할 수 없습니다. 또한, 이런 정부가 발표한 방안 중에서는 법 개정이 필요한 것도 있어서, 구체적으로 그 내용들을 확인하는 데까지는 시간이 걸리는 사안들도 있다고 생각합니다. 그래서 현시점에서 실적에 미치는 영향을 정확하게 추정하는 데는 여러 가지 제약이 있을 수밖에 없는 상황입니다. 다만 기본적으로는 정부의 정책 기조에 대응해서 저희들도 이용자의 선택권 확대 및 차별적 경쟁력을 강화해 나간다는 방침은 계속 유지해 나가고요. 또 한편으로는 매출에 대한 영향도 있겠지만, 저희들 내부적으로 보면 효율적인 비용 집행이라는 부분도 있습니다. 그래서 이를 통해서 저희가 전체 실적을 견조하게 관리해 나가겠다라는 방침을 일단 말씀을 드리고요.

So it gives us a good idea.

I'll put you down whether it's net of hedges.

And within.

Two months.

The jumbo going on until he comes on their two level, you're not going to be.

Okay Joseph Smith.

But you didn't talk about hunting isn't at the pump getting into peduncles space.

Chairman I would think of Nomura.

She got nickel in it sounded like there was some cause I mean, because if I listen to Mr. She took him to children.

It's still under an innovative charges forgiveness along with them.

I'm on cable Onda, we don't know what the tongue boy it sounds like you do at any of them illustrated.

Jason one up for me.

I bet, a continual kind of like an island in a punk human because of two planned pivotal dimitry, Danielle we catch them and take them to David Joe would've Amendment, the filtering in PMT Ping it implementation.

Uh huh.

And Kevin can enjoy it.

And then on to me.

Somebody could equal blend political me until you guys doing.

Jin-won Kim: 또 한편으로 보면, 저희가 이런 MNO 시장에서의 대응도 중요하지만, 이전에 말씀드렸던 것처럼 AI와 관련된 AI Company로의 비전을 저희가 말씀드린 부분인데, 미래의 성장을 위해서, 이런 성장 동력을 확보하기 위해서 저희 같은 실적이라는 부분도 굉장히 중요하기 때문에 안정적인 실적 관리가 굉장히 중요하다고 생각을 하고 있습니다.

And then she's doing yourself too much energy mandate.

Yeah, you're welcome.

Company right.

Some didn't.

You didn't get home Gung Ho.

Sometimes I think that they should do.

I'm going to get their money on doing things she took a look and get together.

The government's announcement includes various measures, including a potential introduction of another telco player and measures related to and the NFL players.

Operator: The government's announcement includes various measures, including a potential introduction of another telco player and measures related to MVNO players. Some of the measures announced by the government may have the potential to impact our revenue, but some of the measures require relevant laws to be revised. It may take some time for us to understand the details, and their potential impact on our revenue. At the same time, we have this stance that we will continue to offer more choices and differentiated benefits for our customers, and we're going to engage in conversation with the government continuously. At the same time, while some of the measures may have an impact on our revenue, we will continue to improve efficiency in our operation so that we can maintain a solid level of earnings continuously.

And some of the measures announced by Cup, but noticed by the government may have the potential to impact our revenue, but some of the measures required relevant laws to be revised so it may take some time for us to understand the details and their potential impact on our revenue.

And at the same time, we have this stance that we will continue to offer more choices and differentiated benefits for our customers and we're going to engage in conversation with the government continuously and at the same time, while some of the measures may have an impact on our revenue we will continue to improve efficiency.

Our operation so that we can maintain a solid level of earnings.

The newest slim because it is not only important to respond to the market, but also to realize the vision of becoming an AI company, we need to have a solid earnings basis to pursue these measures pursue future measures to achieve this vision. So that is our overall stance.

Operator: It is not only important to respond to the MNO market, but also to realize the vision of becoming an AI company. We need to have a solid earnings basis to pursue future measures to achieve this vision. That is our overall stance.

Oh terrific record all cyclical winners on the tongue in.

Jin-won Kim: 추가해서 우리 구독 사업과 관련해서는 작년 5월 정도 준비해 왔던 저희 YouTube Premium 출시 대한 영향에 대해서 문의가 있으셨는데요. 이와 관련해서는 저희 구독 사업을 담당하고 계시는 나서영 담당께서 추가적인 설명을 해주시겠습니다.

What are the terms of Columbia, Pennsylvania, Youtube premium to children and young adults and when you guys shouldn't you Avalon is unnecessary kudos travel I've done nothing.

Nothing.

What I can say.

On your second question is related to the benefit or impact of Youtube premium on the performance of T universe and industry regard I'd like to invite Mr. That's all your all the subscription service planning to meter to comment on this question.

Operator: Your second question is related to the benefit or impact of YouTube Premium on the performance of T Universe. In this regard, I'd like to invite Ms. Na Seo-young, the Subscription Service Planning Team Leader to comment on this question.

Hey, Tony to Youtube, we're putting up here with one question on water attrition, India, well it shouldn't cause you some quarters with Tmall I put a little kids.

Na Seo-young: 저희 T 우주에서 YouTube Premium 제휴 상품을 지난 5월에 출시했는데요. 지금까지 성과도 좋지만 앞으로 더 기대가 큰 시점입니다. 저희도 마케팅을 열심히 하고 있지만, 그 이상으로 고객들의 자발적인 바이럴이 확산되면서 T 우주 가입자 성장에 기여를 잘하고 있습니다.

So we do about kicking.

Could you talk a little about Turkey and pilot something that's all you do cuts or something unique here is how we used to be.

You bet.

Yes, the Youtube premium was included as an option in March and in May This year and all of this has been very successful and there's much more to expect in the future we've been carrying out some marketing activities, but it has rather become more viral by the customers on social media. So it has been contributing to the <unk>.

Operator: Yes, the YouTube Premium was included as an option in May this year, and this has been very successful, and there is much more to expect in the future. We've been carrying out some marketing activities, but it has rather become more viral by the customers on social media. It's been contributing to the increase of subscriber base of T Universe.

Piece of subscriber base of U T universe.

Okay.

H, one and two using a hand in hand to put or getting caught up with them in India. We would you pursue a auction at all female Mackay Panyard Youtube premium hung around cutting goggles Lulu today mother nature.

Na Seo-young: 네, 이렇게 고객들이 좋아하는 주요 이유 중에 하나는 독보적인 가성비 때문인데요. 우주패스의 옵션으로 YouTube Premium을 가입하면 YouTube Premium 하나랑 같은 가격으로 최대 6만 원의 추가 혜택을 받을 수 있는 게 가장 큰 장점입니다.

How do you see NIM Cutbank Santana tell me that.

The reason why this has been well received by the market is because of the value that it offers are when you are when you sign up for you pass universe passed that includes the Youtube premium then you can get the benefit of maximum 60001 per month for the same price that you would pay for the Youtube premium subscription only.

Operator: The reason why this has been well received by the market is because of the value that it offers. When you sign up for U Pass, Universe Pass, that includes the YouTube Premium, then you can get the benefit of maximum KRW 60,000 per month for the same price that you would pay for the YouTube Premium subscription only. Because of this wonderful benefit in terms of value, there has been very good result, and YouTube Premium has become already one of the top three most popular selections of Universe Pass. Thanks to this, the number of T Universe subscribers has already reached 2 million in the Q2, and in the H1 of this year, the GMV amounts to about KRW 630 billion.

They don't come from a doctor named publisher doesn't really I'm going to go into India.

Would you pursue type touching a youtube premium or something kind of pitching in.

<unk> would you pursue Peggy Okay, oops, Shanghai from generic pass it out to me that the forget the a usually they'll continue to pick us it'll keep that looks to me that.

Because of this wonderful benefit in terms of that you are there has been very good result, and Youtube premium has become already one of the top three most popular selections of your universe pass.

It on Youtube tissue block up hang on.

First off you can get back with you with your capes and anything monies to pay cool.

Or is it a correct do you tell them to come back all beside ourself from that.

Thanks to this the number of T universe subscribers has already reached $2 million in the second quarter and in the first half of this year. The G. M. B amounts to about 630 billion won.

And so as the chicken Youtube premium Red Hawk, who get funneled ocado prevents them from going out I mean, you shouldn't do it yourself you have a question each named Jamie that it's okay to walk to and have pretty much done.

Somebody who doesn't need a pro to kick them out and you just want to proceed.

In addition to the Youtube premium service. So we are constantly engaging in negotiations and discussions to include our popular products and services as part of the subscription package and we're going to continue to introduce and add impactful partnerships and products going forward. So I'd like to ask for your continued interest.

Operator: In addition to the YouTube Premium service, we are constantly engaging in negotiations and discussions to include popular products and services as part of the subscription package, we're going to continue to introduce and add impactful partnerships and products going forward. I'd like to ask for your continued interest.

Q1 Q.

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Operator 2: The following question will be presented by Joonsop Kim from KB Securities. Please go ahead with your question.

Following question will be presented by Jee Kim from Kb Securities. Please go ahead with your question.

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Because of course, you can find a lot of that over the course without autonomous clouds, and Thomas Weisel Louise Hope so yes.

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I'm Kim Jin sang from <unk> Securities I have two questions. The first question is related to your marketing related outlook and the second is related to your cloud business first of all we see that there has been a stabilized stabilization trend for marketing expenses in the middle market and there are some expectation.

Operator: I'm Joonsop Kim from KB Securities. I have two questions. The first question is related to your marketing related outlook, and the second is related to your cloud business. First of all, we see that there has been a stabilization trend for marketing expenses in the MNO market, and there are some expectations for flagship handset launches in H2 of the year. There may be some competition to acquire additional 5G or new subscribers. In H2 of the year and going forward, how much marketing expense are you planning to execute, and what is the overall guideline for marketing related expenses? The second question has to do with your cloud business, and I'd like to understand more in terms of cloud business growth potential and business strategies.

<unk> four flagship handset launches in the second half of the year and there may be some competition to acquire additional <unk> or new subscribers. So in the second half of the year and going forward. How much marketing expense are you planning to execute and what is the overall guideline for marketing related expenses.

Question has to do with your cloud business and I'd like to understand more in terms of cloud business growth potential and our business strategies is the CFO mentioned there has been a 60% growth Q on Q, if you're a cloud business revenue and as you mentioned that the company may benefit from increasing demand for AI and hybrid cloud so.

Operator: As the CFO mentioned, there has been a 60% growth Q1Q of your cloud business revenue, and the CEO mentioned that the company may benefit from increasing demand for AI and hybrid cloud. To be more specific, what kinds of clients are you targeting and what kinds of cloud strategies are you going to pursue so that you could achieve KRW 500 billion or alpha of revenue by 2027? Thank you. Thank you for your questions. Yes, looking at the trend of marketing expenses is a litmus test to see how much of competition there is in the market. Therefore, it may be meaningful to take a look at the overall trend of marketing expenses. When it comes to the comparisons, because of the flagship handset launch schedules announced by the manufacturers, Quarter over quarter comparison may not be meaningful that much compared to the YOY comparison.

To be more specific what kinds of our clients are you targeting and what kinds of cloud strategies are you going to pursue so that you could achieve 500 billion won where alpha of revenue by 2027. Thank you.

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Thank you for joining us.

Thank you for your questions, Yes, I'm looking at the trend of marketing expenses as a litmus test to see how much of competition. There is in the market. Therefore, it may be meaningful to you to take a look at the overall trend of marketing expenses.

But when it comes to the comparison, so because of the flagship handset launch schedule as announced by the manufacturers the quarter over quarter comparison may not be meaningful that much compared to the Y O Y comparison. So on in terms of the Y O Y basis, I would like to say that the marketing expenses for.

Operator: In terms of the YOY basis, I would like to say that the marketing expenses for Q2 declined by 0.6%, and it has been maintaining a stable level. Going forward, we will continue to stick with the existing stance of focusing more on margin and profitability while engaging in efficient market operation. Regarding the overall market landscape, I'm going to invite Kim Ji-Young, Head of the Integrated Marketing Strategy Office, to comment more on that. Moving on to your second question, I'm going to invite Kim Myeong-kook, Head of Cloud Business Office, to comment on our cloud related strategies. Hello, I'm Kim Ji-Young, Head of Integrated Marketing Strategy Office. When we look at the current market, it has been maintaining a stability because of the lengthening of the handset replacement period.

The second quarter declined by 0.6% and it has been maintaining a stable level and going forward. We will continue to stick with the existing stance of focusing more on the margin and profitability, while engaging inefficient market operation and regarding the overall market landscape I'm going to invite Kim Chi.

I'm head of the integrated marketing strategy office to comment more on that and moving onto your second question I'm going to invite Kim Jong woo head of cloud business office to comment on our cloud related strategies.

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Hello, I am Kim Chi I'm head of integrated marketing strategy office.

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With me that when we look at the current market. It has been maintaining a stability because of the lengthening of the handset replacement period.

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Operator: As you mentioned, in H2 of the year, flagship handset releases are to be scheduled. However, as the 5G market becomes more mature, we see increasing share of customers switching from 5G to 5G. Therefore, it is our view that competition to acquire additional new 5G subscribers will not be fierce. Therefore, we will continue to manage our marketing expenses in a strategic and efficient manner in consideration of the market situations. Thank you. I am Kim Myeong-kook, Head of Cloud Business Office. In Q2 2023, the cloud revenue recorded KRW 39.8 billion, up 67.67% year-on-year. In particular, as for MSP, the recurring revenue takes up more than 90% of the total revenue for five consecutive quarters. This has been made possible thanks to our fundamental strengths, including being number one in terms of mobile and fixed telecommunications business in Korea.

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As you mentioned in the second half of the year of flagship handset releases are to be scheduled.

As the market becomes more mature, we see a increasing share of customers switching from five <unk> to five cheap. Therefore, it is our view that competition to acquire additional new five year subscribers I will not be fears and.

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Therefore, we will continue to manage our marketing expenses in a strategic and efficient manner and consideration of the market situations. Thank you.

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I am Kim Mango head of our cloud business office.

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In the second quarter of 2023, the cloud revenue recorded 39 8 billion won.

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In particular as for MSP, the recurring revenue take some more than 90% of the total revenue for five consecutive quarters. This has been made possible. Thanks to our fundamental strengths, including a being number one in terms of mobile and fixed telecommunications business in Korea, and we have the.

AI and big data and other very high quality telecommunications assets, which has been the basis for such a success and going forward as there will be increasing demand for hybrid cloud. We believe that we can continue to utilize these assets and serve as the sophisticated MSP.

Operator: We have the AI and big data and other very high-quality telecommunications assets, which have been the basis for such a success. Going forward, as there will be increasing demand for hybrid cloud, we believe that we can continue to utilize these assets and serve as the sophisticated MSP. We will not just doing the reselling as CSP, but rather provide a customized cloud related consulting services and help customers maximize their cost efficiency using AI and provide more tailored total solutions to our clients so that we can continue to increase the portion of recurring revenue from MSP business. For instance, for the financial institutions, we can provide support in terms of data analysis and information security using AICC. For AI developing companies, we can provide a GPU-supported cloud infrastructure.

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We will not just doing the reselling S P, but rather provide a customized cloud related consulting services and help customers maximize their cost efficiency using AI and provide more tailored total solutions to our clients. So that we can continue to increase the portion of recurring revenue from them.

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For instance for the financial institutions, we can provide support in terms of data analysis and information security using AI T C and for it for AI developing companies. We can provide a G. P S supported cloud infrastructure.

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Operator: We will continue to utilize our own AI cloud and design capabilities and collaborate with SAPEON so that we can actively address and respond to public and hybrid cloud demand triggered by ChatGPT. By utilizing these capabilities and strengths, SK Telecom will continue to pursue high growth in the medium to long term by operating in the markets where CSPs who are reselling MSPs cannot enter easily. Thank you.

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And we will continue to utilize our own AI cloud and design capabilities and collaborate with top young so that we can address actively address and respond to public and hybrid cloud demand triggered by CECI P T.

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And obviously that well use it utilizing these capabilities and strengths of SK Telecom will continue to pursue high growth in the medium to long term by operating in the markets, where csp's or reselling msp's cannot enter easily.

Thank you.

Grom.

Hee Jun Chung: 네, 그럼 23년 2분기 실적 발표 콘퍼런스 콜은 여기서 마치도록 하겠고요. 혹시 오늘 답변이 미진했다거나 추가적으로 궁금한 점이 있으시면 언제든지 저희 IR 조직에 문의해 주시기 바랍니다. 오늘 콘퍼런스 콜 여기서 마치도록 하겠습니다. 감사합니다.

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Who knows how much total highest I'm sorry. This concludes the earnings conference call for the second quarter of 2023, if you need further explanation so or have additional questions. Please feel free to contact IR. Thank you.

Operator: This concludes the earnings conference call for Q2 2023. If you need further explanations or have additional questions, please feel free to contact IR. Thank you.