SK Telecom said its net profit for the third quarter shrank 54.2% despite a slight rise in revenue, blaming heavy spending on LTE network equipment and marketing.
South Korea's largest operator reported a profit for the quarter of 175.6 billion won ($160.8 million). Operating profit also fell 46.4% year on year, while ebitda declined by 21.1% to 959.9 billion won.
Spending on network upgrades, including SK Telecom's nationwide LTE rollout, climbed 42.8% sequentially to 788 billion won.
Revenue by contrast grew 2% year on year and 2.9% quarter-on-quarter to 4.13 trillion won, in a result attributed to improved ARPU due in part to LTE subscriber growth.
SK Telecom's investment in LTE is also paying off in terms of 4G customer growth. The operator had over 6 million LTE customers by the end of October, and expects to hit its target of 7 million by the end of the year.
Despite the short-term impact on profit, SK Telecom seems committed to continue its pace of spending on its LTE network.
CFO Ahn Seung-yun said the company will “reinforce its status as the global leading LTE service provider by strengthening its core competitiveness in network quality, innovative services and differentiated customer care.”