Seoul: KT Corp., South Korea's second-largest wireless carrier, announced a 31.5 percent decline in net profit for the first quarter compared to the previous year, as its mobile business continues to grapple with the repercussions of a data breach that occurred last year. The company's net profit reached 388.3 billion won (US$261.4 million) during the January-March period, a decrease from 566.8 billion won in the same period the previous year, according to a regulatory filing. According to Yonhap News Agency, KT's operating income for the quarter also experienced a 29.9 percent year-on-year decline, totaling 482.7 billion won, while sales decreased by 1 percent to 6.77 trillion won. Despite these declines, the earnings surpassed market expectations, with analysts predicting an average net profit of 349 billion won based on a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency. KT attributed its first-quarter earnings challenges to the customer compensation programs necessitated by the da ta breach incident reported in September last year. This breach led to a series of unauthorized micropayments, compelling KT to revamp its security systems. The company's core mobile business continued to suffer from the breach's aftereffects, incurring costs from waiving penalties for subscribers in January and implementing compensation programs for affected customers. On another front, KBank, KT's internet-only banking affiliate, which debuted on the main KOSPI market in March, reported 28.22 trillion won in deposits and 18.75 trillion won in loans by the end of March. The total number of customers rose to 16.07 million. In a move to bolster shareholder confidence, KT announced it would continue using 50 percent of its standalone adjusted net profit for shareholder returns. The company plans to maintain cash dividends alongside share buybacks and cancellations as part of its shareholder return program. Looking forward, KT revealed its intention to accelerate its artificial intelligence (AI) transformatio n strategy. The company aims to position itself as a leading global AI partner, with the goal of enhancing profitability in the coming quarters.
