KT Posts 205% Profit Surge Amid Data Breach Costs

Date of Call: Feb 10, 2026

Financials Results

• Revenue: KRW 28,244.2 billion, up 6.9% YOY

Business Commentary:

Revenue and Operating Profit Growth:

• KT Corporation reported an operating revenue of KRW 28,244.2 billion, up 6.9% year-on-year, and an operating profit of KRW 2,469.1 billion, a significant 205% increase compared to the previous year.
• The growth was driven by strong performance in core businesses such as data centers, cloud services, and the Gwangjin-gu real estate project, as well as profitability improvements and one-off gains.

Wireless and Broadband Expansion:

• Wireless revenue increased by 2.8% to KRW 7,155.4 billion, with 5G penetration reaching 81.8%, and broadband revenue rose by 1.9% to KRW 2,533.5 billion.
• Growth was attributed to subscriber expansion and increased penetration of 5G services and GiGA broadband.

KT Cloud and Estate Performance:

• KT Cloud revenue grew by 27.4% year-on-year to KRW 997.5 billion, while KT Estate revenue increased by 15.9% to KRW 719.3 billion.
• KT Cloud's growth was due to rising data center usage by global customers and expanding AI cloud demand, and KT Estate's increase was driven by strong hotel business and new property development projects.

Data Breach Incident Impact:

• KT Corporation acknowledged a data breach incident and outlined a customer compensation package estimated at KRW 450 billion.
• The company emphasized that not all costs would be booked immediately, with certain expenses to be recognized based on customer usage, and expressed commitment to regaining customer trust through various measures.

Shareholder Returns and Corporate Strategy:

• KT increased its dividend per share by 20% from KRW 2000 to KRW 2400 for 2025 and plans a share buyback and cancellation worth KRW 250 billion for 2026.
• This reflects a progressive shareholder return policy, and the company expects the new CEO's strategy to align with the commitment to enhancing corporate value and sustaining growth.

Sentiment Analysis:

Overall Tone: Neutral

• Management expressed commitment to strengthening fundamentals and rebuilding trust after a data breach, stating 'Regaining trust is our foremost priority.' They highlighted strong YOY growth in revenue and operating profit, but noted a focus on efficiency and cost management, saying 'we are going to focus on making our operations more efficient.'

Q&A:

• Question from Wonseok Hwang (Shinhan Securities): I have 2 questions that I would like to ask. The first one, I would like to understand as to what the financial impact is of your customer compensation package regarding the data breach incident? And my second question is with the incoming new CEO, I would like to understand as to whether he will be keeping to the previous shareholder return stance that the company has shown?
  Response: The compensation cost is partially booked in 2025, with future costs to be treated based on auditor consultation; management plans for 2026 earnings to be better than 2025. The new CEO is expected to maintain the progressive shareholder return policy, with no significant change to the strategic growth approach.

• Question from Minha Choi (Samsung Securities): I would also like to ask you 2 questions. First is on the outlook for your wireless business going forward... I understand that there was a 14 days of cancellation fee waiver period... I would like to know under that backdrop for this year, what is your outlook for your wireless business growth? My second question is compared to your peers in the industry, your B2B growth seems to be much slower. Would like to understand as to the reason why and what your outlook for your B2B business going forward is?
  Response: Wireless outlook is for efficiency improvements rather than double-digit growth, as net subscriber additions for the full year were positive. B2B growth, including KT Cloud, was 6% YOY; KT Cloud itself grew 27.4% YOY, and this strong trend is expected to continue.

Contradiction Point 1

Financial Impact and Timing of Customer Compensation Costs

Contradiction on when compensation costs are recognized and their total estimated value.

What is the financial impact of the customer compensation package related to the data breach? - Wonseok Hwang (Shinhan Securities)

2025Q4: The customer appreciation package is estimated to be worth about KRW 450 billion in benefits. Not all will be booked as cost in 2025... A portion is already reflected in 2025 results, and additional costs in 2026 will be treated appropriately. - [Min Jang](CFO)

What is the financial impact of the recent hacking incident, including compensation to customers and preventive measures, and what expenses were captured in Q3 along with the timing and scope of future expenses? - Chan-Young Lee (Eugene Investment & Securities Co Ltd.)

2025Q3: Costs for SIM replacement will be recognized in Q4, while expenses for free data and handset tariff discounts will be booked when incurred. - [Min Jang](CFO)

Contradiction Point 2

B2B Business Growth Outlook

Contradiction on the growth rate characterization for the B2B segment.

What factors are contributing to KT's slower B2B growth relative to peers, and what is the business's outlook for this segment? - Minha Choi (Samsung Securities)

2025Q4: KT's B2B growth includes KT Cloud. When combined, the growth rate is 6%, which is not low given the market size and share. - [Min Jang](CFO)

What is the fourth-quarter projection considering seasonality and expenses, is there further upside to the dividend payment, and will the 2026 share buyback and cancellation size exceed the 2025 plan of KRW 1 trillion? - H.J. Kim (Daishin Securities Co. Ltd.)

2025Q3: For the full year 2025, the company believes it can achieve year-over-year growth on both consolidated and separate bases, driven by... core business growth. - [Min Jang](CFO)

Contradiction Point 3

2026 Performance and Earnings Outlook

Contradiction on the expected trajectory of 2026 financial performance.

What is the financial impact of customer compensation from the data breach? - Wonseok Hwang (Shinhan Securities)

2025Q4: The company plans for 2026 performance/earnings to be better than 2025. - [Min Jang](CFO)

What is KT's focus in AI going forward? How will the repeal of the Handset Subsidy Act affect KT's MNP market? - Joonsop Kim (KB Securities Co., Ltd., Research Division)

2025Q2: The strong Q2 performance included a significant one-off gain from real estate. Excluding that, the underlying business momentum is solid... - [Min Jang](CFO)

Contradiction Point 4

Shareholder Return Policy Continuity

Contradiction on the certainty of maintaining the progressive shareholder return policy.

Will the new CEO continue the previous shareholder return strategy? - Wonseok Hwang (Shinhan Securities)

2025Q4: The final 2026 shareholder return plan will be set by the new CEO and Board, but is expected to align with the progressive stance... - [Min Jang](CFO)

What is the outlook for the second half of the year given the Q2 results, and are there any updates or potential changes to the value-up plan regarding dividends or share buybacks? - Hoi Jae Kim (Daishin Securities Co. Ltd., Research Division)

2025Q2: The dividend of KRW 600 per share (a 20% YoY increase) is declared in line with the company's policy of targeting 50% of adjusted net profit. The Board of Directors is confident in maintaining performance and will make future decisions aligned with market expectations. - [Min Jang](CFO)

Contradiction Point 5

Wireless Subscriber Growth Outlook

Contradiction on the growth trajectory for the wireless business.

How will subscriber churn from the data breach and the 14-day cancellation fee waiver impact the 2026 wireless business growth outlook? - Wonseok Hwang (Shinhan Securities)

2025Q4: High double-digit growth for wireless in 2026 is unlikely. - [Min Jang](CFO)

Could you provide guidance on your 2025 outlook for revenue, profit, and shareholder returns? - Shin Eun Jung (DB Financial and Investment Securities)

2024Q4: The revenue guidance for 2025 is on a consolidated basis above KRW 28 trillion. Specific profit guidance cannot be shared, but based on the 2024 profit size and the effects from structural improvements, expansion of AICT revenue, and initiatives, an appropriate estimation can be made. - [Jang Min](CFO)