KT CI
South Korean telecommunications giant KT Corp. saw its operating profit plunge nearly 30 percent in the first quarter of 2026 due to heavy compensation costs following a security breach.
KT announced on Tuesday that its first-quarter operating profit stood at 482.7 billion won ($323.5 million), down 29.9 percent on year. Revenue reached 6.78 trillion won, down 1 percent.
The sharp drop in operating profit was mainly attributed to costs related to last year’s hacking incident, including waived cancellation fees, customer compensation programs, and expenses associated with strengthening cybersecurity measures.
Wireless service revenue rose slightly by 0.4 percent to 1.68 trillion won. Although KT saw some subscriber losses following the waiver period for cancellation fees, the company said net subscriber growth turned positive after February.
KT noted “efficiency” and “smart profitability” as its key growth themes for this year. Rather than aggressively increasing marketing expenses to attract subscribers, the company plans to maintain profitability through lower-cost distribution channels such as non-face-to-face sales and used smartphone programs.
Revenue from enterprise services fell 2.2 percent due to the completion of several large-scale projects and restructuring of low-profit businesses. However, KT secured contracts during the first quarter for a national disaster safety communications network as well as AI contact center and cloud projects in the financial sector.
The company is also expanding AI transformation (AX) orders centered on financial industry clients through partnerships with Microsoft and Palantir Technologies.
KT further emphasized its transition into an AX platform company.
It plans to strengthen its agent-based AICC capabilities while expanding industry-specific and hyper-personalized AX services.
The company plans to develop tailored AI transformation packages for sectors including finance, public services, manufacturing, and defense, eventually expanding them into long-term managed service models.
AI data centers are also being positioned as a major growth pillar.
KT highlighted its experience operating the largest number of data centers in Korea. To prepare for high-power AI workloads, the company has introduced liquid cooling technology at its Gasan data center and is currently testing the system.
KT also announced a medium-term shareholder return policy for 2026-2028.
Under the plan, KT will allocate 50 percent of its adjusted standalone net income to shareholder returns. The company proposed a minimum annual dividend of 2,400 won per share this year, higher than the previous policy’s minimum of 1,960 won. First-quarter dividends were confirmed at 600 won per share.
KT will also continue its treasury stock buyback and cancellation program. The company is currently carrying out a plan launched last year to repurchase and retire shares worth a total of 1 trillion won by 2028. This year alone, KT has been repurchasing 250 billion won worth of shares since March.
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