South Korea’s telecom firms have flagged better-than-expected business outcome during the first quarter of this year, as the companies have witnessed growth in revenue from Internet television services.
In a statement released Tuesday, SK Telecom said its operating profit came to 323 billion won ($275 million) in the January-March period. It was down 0.9 percent from a year ago, but the decline was much smaller than last year, when profit shrank about 20 percent compared to a year earlier.
The better-than-expected result was aided by year-on-year growth in contents sales from internet protocol TV services, experts said. While the revenue from mobile business shrunk 6.1 percent to 2.4 trillion won, IPTV revenue increased about 18 percent to 315.6 billion won.
“Improved profits from media and content businesses have contributed to growth in revenue,” said Choi Kwan-soon, an analyst from SK Securities. “The focus is on the telecom business growth based on IPTV.”
KT holds a event to celebrate its 5G commercial rollout. Yonhap
The same can be said to other telecom giants, which announced first quarter earnings records last week. KT’s first-quarter operating profit came to 402 billion won, 1.3 percent up from a year earlier. Its revenue reached 5.8 trillion won, 2.2 percent increase from a year ago.
While the revenue from mobile business shrunk 0.5 percent to 1.73 trillion won, IPTV posted improved sales a year before. Its first-quarter revenue reached 377.4 billion won, an increase of about 18 percent from the same period a year ago.
LG Uplus also saw improved first-quarter earnings thanks to double-digit growth in IPTV revenue. Its operating profit came to 194.6 billion won, 3.7 percent increase from a year before, and its IPTV revenue reached 250 billion won, about 23 percent increase from a year ago.
“Our business growth was aided by exclusive offering of Netflix content,” said LG Uplus, stressing its partnership with Netflix to offer IPTV subscribers various content from the world’s biggest streaming giant. “There is also growing popularity of our selected content for target audiences.”