SK Telecom has reported a 20% slump in net income for the second quarter to 397.9 billion won ($339.7 million), with earnings impacted by regulatory requirements to eliminate a mobile fee.
Revenue declined 1.2% to 4.25 trillion won, as a result of the regulator-mandated elimination of mobile activation fees and a reduction in mobile interconnection charges.
This decline, coupled with a one-off increase in labor costs, led to the sharp decrease in net profit.
SK Telecom's total LTE subscriber base increased to 17.94 million, or 62.6% of the company's total mobile subscriber base. The monthly average data consumption per LTE subscriber meanwhile increased by 300MB quarter-on-quarter to 3.3GB.
During the quarter, SK Telecom said it had made efforts to differentiate by providing superior value to customers. The operator's new Band Data plans attracted 2.13 million subscribers by the end of the second quarter.
The company also launched differentiated services personalized to specific customer segments, such as a bundle of content, community and commerce services designed for children.
These efforts helped SK Telecom to reduce its churn rate to 1.3% in the second quarter, its lowest since 2003.
“SK Telecom will maximize customer value and secure new growth momentum by building an open ecosystem based on its outstanding telecommunications capabilities and successfully shaping into a next-generation platform player that provides innovative products and services that meet customers’ varying needs,” SK Telecom CFO Lee Yong-hwan commented.