KT sees profit drop after heavy marketing of LTE

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KT sees profit drop after heavy marketing of LTE

Korean telecom titan KT said yesterday its earnings fell 43.4 percent in the second quarter from a year ago as it beefed up marketing costs to attract subscribers to the fourth-generation long-term evolution network.

Net profit totaled 238 billion won ($210 million), compared with a 420.6 billion won profit the previous year, the company said in a regulatory filing.

Sales rose 8.1 percent on-year to 5.8 trillion won over the cited period, while operating profit dropped 14 percent to 371.7 billion won.

The weaker bottom line was attributed to increased spending on the LTE technology, which runs up to five times faster than the existing third-generation network. The country’s three mobile carriers have been ramping up their LTE drive as part of efforts to lure users to the faster network.

KT, which is the country’s top fixed-line and No. 2 mobile operator, was the latest to join the LTE race. The company is the country’s smallest provider of LTE services, with subscribers totaling 1.5 million as of the end of July.


Yonhap

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