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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] KT Corporation reported a decline in profitability for the first quarter of 2026, as one-off factors and increased costs weighed on earnings despite stable core telecom performance.
The company posted consolidated revenue of KRW 6.78 trillion, down 1% year-on-year. Operating profit fell 29.9% to KRW 482.7 billion, while net profit dropped 31.5% to KRW 388.3 billion. On a standalone basis, revenue reached KRW 4.83 trillion with operating profit of KRW 313.9 billion.
KT attributed the weaker profitability to base effects and cost factors rather than its core telecom business. While wireless and fixed-line revenues posted modest growth, last year’s strong real estate sales gains created a high base, and expenses related to customer reward programs and security incident responses further pressured margins. The enterprise services segment also declined due to the completion of large-scale projects, with analysts noting that contributions from artificial intelligence transformation (AX) initiatives will take time to materialize.
In the wireless segment, subscriber churn occurred during a penalty waiver period but returned to net additions from February. Wireless service revenue rose 0.4% year-on-year, with 5G subscribers accounting for 82.7% of total handset users as of the end of the first quarter.
Fixed-line revenue increased 0.8% year-on-year, supported by subscriber growth. The broadband business saw revenue rise 1.8% on the back of expanding gigabit internet subscriptions and value-added services, while the media segment grew 1.3% driven by IPTV subscriber gains and increased adoption of premium set-top boxes.
Enterprise services revenue declined 2.2% due to the completion of large projects. However, KT secured new contracts, including public sector projects such as disaster safety communication networks and financial sector deals in AI contact centers (AICC) and cloud services. The company plans to expand AX initiatives across finance, public, and manufacturing sectors through strategic partnerships with Microsoft and Palantir Technologies.
Group affiliates contributed to overall performance, particularly in cloud, real estate, and media. KT Estate reported revenue of KRW 237.4 billion, up 72.9% year-on-year, driven by progress in a residential development project in Daejeon and a recovery in hotel demand. KT Cloud maintained stable revenue levels supported by demand for data centers and AI cloud services.
KT also announced a mid-term shareholder return policy for 2026–2028, under which it will allocate 50% of adjusted standalone net profit to shareholder returns through a combination of cash dividends and share buybacks and cancellations.
The company set a minimum annual dividend per share (DPS) of KRW 2,400 for this year, matching last year’s level to reduce investor uncertainty amid earnings volatility. The first-quarter DPS was set at KRW 600, with a record date of May 27 and payment scheduled for June 11.
KT is also proceeding with a KRW 250 billion share buyback and cancellation program announced in February, with repurchases already underway since March.
Since the appointment of CEO Park Yoon-young, KT has declared its transition into an “AX platform company,” focusing on expanding industry-specific and hyper-personalized AI transformation services.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
