LG Uplus reports $185 mn in Q2 OP as costs increase

LG Uplus Corp. CI

LG Uplus Corp. reported a dip in operating profit for the second quarter of 2024 due to increased costs. But its new business-to-business (B2B) sectors, such as internet data centers (IDCs) and artificial intelligence contact centers (AICCs), continued to see growth in their revenues.

According to regulatory filings on Wednesday, LG Uplus posted an estimated 3.49 trillion won ($2.54 billion) in sales and 254 billion won in operating profit for the second quarter. While sales increased by 1.9 percent year-on-year, operating profit decreased by 11.8 percent.

“The amortization costs of intangible assets related to the establishment of a new integrated information system were reflected” in the profit decline, the company explained.

Mobile business sales increased by 1 percent to 1.59 trillion won. The number of mobile subscriptions rose by about 960,000 compared to the previous quarter, while the proportion of 5G plan users increased slightly to 67.7 percent in the second quarter of the year from 65.7 percent in the first quarter.

The corporate infrastructure segment, handling B2B operations, recorded sales of 431.5 billion won in the second quarter, growing by 5.4 percent year-on-year. IDC sales grew by 15 percent to 91.7 billion won, and solution sales, including AICC and smart mobility, increased by 2.7 percent to 130.8 billion won.

LG Uplus is expanding its B2B business, including constructing a mega-scale IDC in Paju, Gyeonggi Province, set to be completed by 2027. It unveiled its B2B growth strategy in July 2024, which aims to enhance AI transition (AX) services to boost revenue. The high-speed internet and IPTV segment saw a 2.5 percent increase in sales to 618.2 billion won due to a rise in subscriptions.

LG Uplus Voltup, a joint venture with Kakao Mobility Corp. to strengthen LG Uplus’s electric vehicle charging business, continued steady growth with the number of operational chargers at 11,144. Chief Financial Officer Yeo Myung-hee stated that the company will continue to focus on AI transformation across all business areas in the second half of 2024.