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.
Conference call doing a chicken the chicken chuan, you've been to regroup.
Hugo.
So <unk> got some cutting it is how can you talk about some during the Q&A session are cognizance of Roche and then I guess for me though.
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.
Is that you had in SK telecom is here for <unk> and touch on only Pilatus I'll ask how popular among the door a couple of smeal since I took over 'twenty. So what's your name there youre talking a meter.
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.
Could you tell US you get Ya man, how long a ton marina to Copa London's handwritten stung critical macro hanging onto an entitlement on ship that I saw the largest retailer in Germany BD might sensitive meter.
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 .
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.
SK telecom shape for continuing to do that.
Good afternoon. This is <unk> Kim CFO of SK telecom.
Speaker 1: Good afternoon, this is Cinnon Tins, UFO of Esquitella,com.
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.
So youre going to Lebanon tons secretary in considerably under your core and non core.
On them within the quarter, you had given us obviously come gigawatt electricity meter.
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.
<unk> you.
You don't Huntington General coupon independent our collection of human engineer defendants Transfiguring, Hong Kong become under a year.
Speaker 3: For more information, please visit our website.
Year SK telecom on lending.
Speaker 3: A ES K telecommon such a Le keep ANA a service K doi o global teco telco. Him mowhile comambanging again have take cougo a I Hi J UN exercise U in a tur Man global telco. A I launch alliance trurine.
Let them keep on Adas service corridor veto global telcos telcos are the humor more <unk> coming up ticket up with Chicago.
She's doing homecare exercise.
Global telco.
Alliance or the Triple meeting.
Ian opinion Consultative Chortle, Deutsche Telekom, Ian Singleton.
Speaker 3: E channel con L to childrenro political eon n thinkl them Europe from Don. I shall planant thir could the local amb.
Europe , Shandong I shall depend on telco locals and Gary Smith.
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.
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.
Global Telco Alliance global and she was on its own Shadow plug is taboo Legion Condor in Cabos and how come you have to lymphoma, reaching a major aluminum of ticket equate to love to help them.
Speaker 3: global cylinder a I could open I'll continue
Speaker 3: we must remember that your creativity is hard work to do.
<unk> <unk> was again.
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.
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.
The Colombian longer tonnage coming on evenly.
Speaker 3: So So Do Do Know And please Anything Anything Anything Anything Anything Anything Anything Anything Anything
Tim we should take a day much introduced me to narrow.
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.
Amit children.
Since all of you some Jonathan <unk>.
Speaker 3: A mero. You was on tuning, since I have some joam assa. And then don't get avid young terms: half percentage in Gun chargees. Some time you ships have one o K o.
Thank you Debbie young terms help us antigen gun.
Hum nuclear power why don't you requested with.
Yvonne can gear flagship <unk> Tvs at a magnitude it comes out so you don't have them at all.
Speaker 3: You want flagship the milulticship be in a carious at a momentary comes AL you, the or somebody. If you don't know bter, it will be more percent.
Won't it have you don't own maturity is Jim will present two hurricanes.
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.
In Q2.
Or even geography, England Hudson from supply wondering kind of day in our metrics on January .
<unk> percentage and Gobble, Kitsap Yung Kim Garden Arena.
Maybe you've jumps happening at the confluence of Cumulus.
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.
And given Egan to none Tom gave you some pattern.
<unk> presented so I'm going to David earnings, 4% to two gun, sometimes how big tissue pedal wondering if it occurs to me that.
Net income grew 34, 8% year on year, and 15% Q on Q to come in at $347 8 billion won.
Hum.
Hum back Cushy, you wanted to get a clear so nantong give me some of them do you are you sound so generally to genco.
<unk> cutoff Samsung to that could you be looking to take his padawan regular Christina.
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.
Commodore AI component of our transformation journey.
<unk> hundred <unk> some color.
My son.
Let me now turn to Q2 business highlights and strategic direction of the company that is pursuing transformation into an AI company.
A moderate Muslim Baghwati SK telecom on paying uncle Navy EA kept rukwa.
Capital rotated hernia.
It is a low cost servicer octane alkylate Smith.
It doesn't annoy you absolute America Pennon, Adas electric Shamir charter <unk> chapter three Pepco scattered Epcot, Queensland gave out on comes on young AI agent to a friend or somebody like that.
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.
[laughter] based AI agent called <unk> Dot friends in collaboration with scatter lap.
<unk> Mellon touch LLM Coldwater, Toni we do not make another power coming out of trading day ever kind of that multi country multi zone single trip on there's a fair amount on quickly with a ship go shionogi, you're almost in parallel young AI service little some giant I'll always similar.
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.
Shannon attributable global attrition as our new President <unk>. Some ship program here for you Jonathan critical local Sanjay Deutsche Telekom T mobile, yes, zinc Tilden piling on here of Joy Globals enough for me to guess.
Under pillar, we submit them.
I'm counting on all of the equal shouldn't game type of incentives skinny with somebody new to Omega June <unk>. We're gonna do you plan to service cigar and <unk> got everybody Smith.
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.
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.
If linden corridor, making ineptly Jacob on the computer system or talking about computer.
And again I always go meal, you don't see a global Internet e-commerce underneath create four meter cause leukemia.
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.
Children, even give what are you going to find even somebody.
For Youtube premium Burlington display or partnership with Toledo, I'm, giving you a little color and I've always Smith.
Our productivity program and you're getting into total case, a cocktail napkin made up taking some computer.
And your children often traveled to Qiagen are repeating one.
Okay.
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.
I'm trying to SK telecom on your money globally.
Churches are saying Tobey Asia.
And again, you talked a lot cheaper to Donald you have presented to you a wonderful price meter erotomania committed jumps hanger LNG you AMG 301.
Here's how congruent with Empire.
It seemed like your return should I myself.
<unk>, obviously sundog Richard Thomas at Keybanc.
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.
And so projects happen to join <unk> and jumped up some quasi usually don't go on the two key data center cloud hardware, sometimes isn't going to accumulate.
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.
Data Center Sullivan.
Our <unk> data center in Zhengzhou colonial Samsung, while putting down eastern telephony, you can lever 10 men don't get Debbie and she presented suddenly mature samsung's root to the critical global shifts we can mentioned.
Data centers.
Some girl Juergen gone there would you have put in a common <unk> toxicity.
Do you think the recent.
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.
New data centers, including securing sites are well underway.
Cloud was helpful. Mitre 10, and don't get Debbie you presented and canceling them yourself younger market considerably.
Yes, I'm always cingal to key AI service of our hybrid cloud as she doesn't have data in Seattle, Chicago, and sometimes you can have a meter.
Keep them Gannon smarter sequential gain communes helps what do you think is a cool and denim <unk> co.
Switching demand pattern in <unk> most recent meter.
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.
Businesses were currently exploring additional business opportunities focused on big accounts.
SK telecom on tire oncogene, Vijay mature or as hungry tongue issue boardroom by reducing your home Directory circle to key she thinks of Crinone appointment young Chung yocum jewelry.
Twin Telemundo chat around retention, okay. So Conway with me that you've done some quarter of a total even get back to doing things on our fiber <unk> tons habeck new ship tumor craftsman.
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.
Reached $14 six 7 million as does the end of Q2.
I'm, Ken your emotions escape rather than the eurobond Sakai plus alone Quebec's has pneumonia.
<unk> Internet pipe Jocelyn you, possibly remind me if I could request a meter.
Gabriel the pendulum swung do you think you are saying is all IP TV my travels of Internet syndrome, I Miss you dearly consumer meal type Joseph Smith.
Neil.
Bravo It in government second TV monocular PTC to be gone hundred in niche markets with a good corner, Vanessa who got some general <unk>.
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.
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.
Multimodal <unk> Madsen, who gives me though.
Finally, let me report on our shareholder return policy.
<unk>, even give you an uncommon to name who can give us on Iran, Sudan paradox from ship owners.
Smith.
The board determined in the second quarter EPS to be the same as the previous quarter at 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.
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.
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.
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.
We ask for your continued support and encouragement. Thank you.
The chrome chicken Vitol Q&A session Restock Kroger Smith.
We will now begin the Q&A session begin with TD and debate I guess meter qimonda.
Tom How do you go to Nick Coppola.
The largest you gave out a leader.
Okay.
The largest human Demeter.
Now Q&A session will begin please press star one that is star one if you have any questions.
<unk> will be taken according to the older you press the numbers Darwin.
Alicia Please press star two star and two on your phone.
Don.
Hello.
You bet.
Oh, you mean Nader.
Question will be presented by Susan Lee from <unk> investment Securities. Please go ahead with your question.
Okay.
You bet.
Uh huh.
Thank you moving to equal one Joe.
You want me to talk about clinical data.
What we don't want me Jody I thought it would be possible.
Question for you.
Paul Hudson those are cool sure Danielle.
Could you walk through.
100.
I'm going to talk about.
The cost of mortgage and good luck.
When do you think in Guangdong will once again well done.
Oh great.
This woman in glory.
Yes.
So triple more hungry.
Right.
Okay.
Hum.
Okay.
Uh huh.
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.
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.
Net charge.
Andrew It is amongst the.
Three volt.
Global Telco Lindsay Theres, some S&P brokers.
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.
Oh, My goodness, it took 7 million year ago.
You should look familiar to you and your charge offs.
Linda and Telemundo digital coal cars, so I'm going to take a key contributor until Pancarditis, how long ago 10 subject and that's done maybe again.
And.
She can talk with them may perpetuate that I'm not so much I'm curious how much shifting to more Japan buffing against something that you're talking about some <unk> binding to.
Sure.
It is a more consumer centric <unk> I'm talking about your childhood, Jamaica eternal when it is however, sometimes meter.
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.
Mm equivalent to many of us the comedians and Youre doing some introductory call can get some testing and of course, the implications of the transaction and so what I can tell you how long you're going to want to continue to pick up on intermediate so he started.
They've got an penciling it out quicker.
Colorado, South Andrea trigger consolidation.
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.
Uh huh.
Maybe more than you do.
I think of the casino unimproved lots of questions on wireless because I can do it.
Children, who had already and keep the cases that you talk to me about 10 of them.
It is.
And in case of any she's doing is accelerating due to cool.
Resource to lenders are going to trigger you almost have to them.
Well the vendor appointment.
Saturday low to pay down and they were able to put them.
It always fulfill E retail and rental.
They put them out and you don't want to double count on that.
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.
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.
<unk> controller.
How much of the EBIT.
How about Kosovo Tomorrow cheeky inhibiting as hundred until then I'm going to come on that.
But.
On unit count temporary because it gives them more truism children pilot clubs.
Who do I don't know if he or she junction nudging a practice energy accordingly.
Sounds like I mean talk too much about it in his heart.
Okay.
Okay.
So if you're under a kind of understand.
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.
So whatever is in the.
Number one it is on them.
Tiger you mean.
Can you give me that one item.
Your own.
Thank you.
Globally 10 of them.
The London.
Ready to drink it solutions and it's embarrassing to Tiger.
Just to get or keep them with regard to each other.
So I can make a horrendous uninterrupted afternoon.
If you want to keep.
Keep on Google and I'm drinking patents do nitrogen they don't want to get financing and in Panama.
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.
Hum.
So on the global Telco Airlines it isn't unquote, some younger to tell you guys confirm your order confusion or give me my simply Nyquil, Great service Saga procuring services really neutral sugars are starting as a pistol.
Cool.
<unk> yeah yeah.
To left hanging Eaton Cummins and could you put a numerical children. So you don't get to your revenues clothing now going in the global telecom terminate certain global telcos.
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.
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.
[laughter] triggering.
Trigger and reasonable buyer.
To compel them to come out.
We are open to money.
Because your customer to keep things going on.
We're monetizing above as other apparel.
We acquire neutron Johan momentum at a week will cause it.
<unk> grown the triple meeting Puglia infusions or the dune.
Don Bobo.
Whom cardona internationally it was roomy with Temodar, so you're going to have cleaner neurological get quite short term you don't want to jump tumor.
Origin would tell you in tonnage.
Hopped on board and get them.
I think we'll get quiet John Higgins.
And you picked up in Washington.
Yeah, Yeah, Yeah, yeah, yeah.
10 years, or so and the Pasha unborn I'll go out to Switzerland could utilize your uncle he already from the time I don't want to run this help Tonight and you got to create some of that.
As you May know very well the tech paradigm is being shifted from web and mobile to AI, especially generative AI.
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.
<unk> seen them do portions of the rig and winning dog man and Tom Selleck.
How did you weigh equal to keep doing video we will give you get doing that gives her term good riddance, obviously than 90 talking during the open has helped out of overseas soon though it is all you have to.
So there was no goudreau and LNG when you retire or we acquire but I can give you a pop when does it go in EA as Hugo Hi, John Hi, Jonathan reminders in an industry.
The telcos I know without awards.
Chris are you doing good how are you going by now.
Okay, you don't have them in Canada as well as in Guangzhou.
We'll go on transformation.
When was this one off charges competitive them under a single command you don't you're going to watch what happens in a visible how do we kind of always seen our platform he doesn't do that.
Parents through Mcdougall at his whole Papa chiquita that wasn't going to always do that.
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.
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.
Can I.
He paranoia Duncan who come out of a million added them.
Who potentially could animal wheel Z boy they are in sugar in games run and then you add it in because we just took a global picture.
She moved all truly logical equal so can you go to China.
<unk> headquartered in.
Everybody have boggy audio and put 100 days to me that there's all good to hear SK telecom, which in a minute.
It is I can get my interests at the headquarters, how you're going to you're going to do a handful global tungsten Bucchero Alliance from Andrew Cole you got someone saw Kim Oregon General Mandel with them either there's a whole bunch of it you can we can give it to me is a global picture could you walk through the vehicle. It helps on the other two motor to only up something of a pause or equal to <unk> <unk>.
You'll get an editing Israel keep other logical liquidity tied up I don't want us predictable when you go to the.
Beyond Europe .
Added end user type ticket buyers grew by doing what we're doing then.
I don't want us since obviously, you don't want the demand rose, which everyone. I would also tell quality. He added them you don't know who to shift gear Temerity total run you.
<unk> children, and really thought of them as Newsweek.
Yeah.
In the <unk> industry, we are seeing a great potential of utilizing LLM and there's 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. 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.
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.
D&C costs either.
What are your MW. She you had stopped.
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.
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.
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.
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.
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.
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.
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.
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.
And until you got the priority service to the initiative that stuck on your table.
Got it.
Young Davidson. Please go ahead.
Cheers.
I wanted to take the pension funds.
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.
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.
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.
Pursued value pursued through market leadership and that it aims to enhance user benefits and convenience through service quality competition among the telcos.
Okay.
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.
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.
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.
Oh terrific record all cyclical winners on the tongue in.
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.
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.
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>.
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.
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.
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.
Q1 Q.
Shimon.
Hello question, but when you talk to Chicago.
Okay.
Thank you Nita.
The crumbling German kg per call home I'm going to hazard August meter.
Yes, you bet, Panama to accumulate discipline in K beans, and corn, Eric and Jim Me neither.
Following question will be presented by Jee Kim from Kb Securities. Please go ahead with your question.
Engage with what I'm talking about keeping some conclusions that can be done.
Oh marketing deal will close hopefully the question is what is your ability.
Oh boy.
Most of the marketing people.
In terms of bundled go to market.
I don't watch it wasn't there.
How long would you sit there today.
Today I'm going to transition go out from that although simple his new lifestyle. That's allowed to get out of Washington deal I'll tell you, it's Keith liquidity pool gets and how long do you market to the extent along with all the buckets. If you will get there.
Okay. That's good.
Because of course, you can find a lot of that over the course without autonomous clouds, and Thomas Weisel Louise Hope so yes.
What's the bogey that you Claude mentioned that he was close when you'll have cool shape. When you before you guys. Obviously meet the hybrid cloud saw considerable push it out when I switched on the deal.
It seems like a new medicine.
Turning to gold card, you're close to hospital or total workforce I put it under the mutual critical military yes, it's quite some time.
So I'm glad that there are two more weeks of synergy so yes, Peter local close to north of two lovers.
So some people leaders can danielle.
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.
<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.
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.
It communicates the Muslim interesting I'm, referring to she Duncan.
What other kind of circumstances that would occur.
I haven't seen them pulling during this.
The spirit two miserable time, you're on marketing because I'm going to admit that.
I think doing it until it's really up until the algorithm that opinion.
So much in tune with it you do it on budget and the fun you can get ahead of them beyond the flagship somebody Tricia doesn't go to Linda I think of them in and book to just have it is tricky to tell him that he had gone into them too and you didn't get.
Well.
30 months ago.
But when do you then you recoup you're getting going talk module correct Yep.
Some young at home video tape and everything when you go through cutting too. So are you going to even get worse.
It can be and we're trying to give you the woman or young timna presented them door comes a hunger local neighborhoods.
And you can add them, they're going to do it because we thought that was independent.
And yet until you got into two way or not but she doesn't do another 10 years her six years with Ya man who's going.
She doesn't want to draw your attention to the Pea.
Most of them.
Then she doesn't when you get is you know what do you say, Kim Jeong pulling up marketing to Lufthansa and some of them.
She will use oh, the cloud how call they mentioned that they didn't get a club type of litigation.
Golf clubs.
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.
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.
Four months into lithium Dunkin' Julien.
Hello, I am Kim Chi I'm head of integrated marketing strategy office.
Children, showing a monkey tissue using cutting edge.
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.
Most of them are in the room.
Somebody sushi there at all.
This one's got unused independent throttle fiver years, if I ever get to the one I'm going to get these unions on time deliveries and you're done.
That answer your on your original enjoyable to the viability of Apache owns and create a catheter can someone looks at Carnival Oh boy.
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.
Oh, SK telecom and a provision was not only how much I'm not sure I'd love to Yehuda overall market from Yamana, when you'll get another kick in.
Therefore, we will continue to manage our marketing expenses in a strategic and efficient manner and consideration of the market situations. Thank you.
Once we close them down commensurate with that.
I am Kim Mango head of our cloud business office.
Even when you're closing these children.
Sure.
Sure.
This to me though.
In the second quarter of 2023, the cloud revenue recorded 39 8 billion won.
67, 67% year on year.
Thank you Ms Kihn, and putting that through between the <unk> and so we should support increased.
Can you talk to immune.
And then.
Canadian Muslim took young young.
Uh Huh peyto since huh, Guangdong counting or getting into the court system cannot pay off to go on with who keep it all goes through China.
Okay great.
Close to it for when you will do MSP leukemia, and Juergen <unk> seen an erosion with me now.
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.
Shifts pizza one in 10 soon to Pemex.
Pretty much closer to an uncontrolled king Yankee bond appealing huh.
Two young closer to contain a total solution.
S K Kim on Ecuador, MSP on young.
Sudhakar, Peru liquidity tuition business will talk we all can you give me that Oh.
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.
S P business.
What are your local news and then Peter Fusco EAC sheets from Google and do a tour.
Students, who wants equal competing per.
I was saying in GPU is quote in Colombia, and Peru took more hill, who took and close it wont go into one system.
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.
1000 <unk>.
Okay.
So appealing or how do I know.
Chuck you, particularly.
But in AI and hybrid it closer sooner to cooking, okay, what's wrong with me.
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.
Are you doing this is Katie minutes are at a point to keep it on the roof and they shift. She has helped US really now resumed shimmer MSP subsidiary, Chile, Colombia, Peru.
And to.
Hum.
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.
You won't be switched over to a corner and you'll get a whole bunch of total hockey akshay.
Well look appealing to them.
I'll touch a little woman told me fishmeal.
It doesn't destroy I Ultrashape can you just you bought them yourself.
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.