Company Reports

LG Uplus' second-quarter services revenue increased by 2% with operating profit up 13% and net profit flat. The flat net profit was due to a large increase in tax.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly, but also mobile virtual network operator subscribers. LG Uplus seemed to have benefited from cyberattacks that affected SK Telecom and, to a lesser extent, KT in 2025, helping its mobile business gain subscriber and revenue market share. LG Uplus' 5.6% growth in fourth-quarter 2025 wireless services revenue (including interconnection) compared favorably with SKT's 4.6% decline over the same period. LG Uplus also added 452,000 mobile customers for the quarter, compared with SKT's 174,000 decline.

LG Uplus' first-quarter services revenue increased by 1.5% with operating profit up 6.6%, compared with competitor SK Telecom's 1.4% revenue decline and 5.3% operating profit decline.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly, but also mobile virtual network operator subscribers. LG Uplus seemed to have benefited from cyberattacks that affected SK Telecom and, to a lesser extent, KT in 2025, helping its mobile business gain subscriber and revenue market share. LG Uplus' 5.6% growth in fourth-quarter 2025 wireless services revenue (including interconnection) compared favorably with SKT's 4.6% decline over the same period. LG Uplus also added 452,000 mobile customers for the quarter, compared with SKT's 174,000 decline.

LG Uplus' fourth-quarter services revenue increased by 5.8%, with operating profit up 20%. 2025 services revenue increased by 3.5%, with operating profit up 3.4% and up 21% underlying, excluding KRW 150 billion of redundancy expenses reported in the third quarter.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

LG Uplus' third-quarter services revenue increased by 4.2%, with operating profit down 34.3% on a reported basis but up 26.6%, excluding KRW 150 billion of voluntary retirement expenses.

LG Uplus' second-quarter revenue increased by 10%, with operating profit up 20% and net profit up 29%. Service revenue increased by 2.5%, with handset revenue up 51%.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

LG Uplus' first-quarter revenue increased by 4.8% with operating profit up 16% and net profit up 25%. Services revenue was up 1.6%, with handset revenue up 18.5%.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

LG Uplus' 2024 revenue increased by 1.8% with operating profit down 13.5% and net profit down 44%. Fourth-quarter revenue was down 1.8% with operating income down 27% and net income down 77%.

South Korean President Yoon Suk Yeol declared martial law following parliamentary disputes. The declaration was voted down by parliament.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

LG Uplus' third-quarter 2024 services revenue increased by 2.9%, with operating profit down 3.2%, although this decline was due to increased depreciation, with EBITDA up 2.4%. These growth rates are broadly in line with the first half and in line with our expectations.

The LG Uplus' second-quarter result was broadly in line with our expectations for revenue, but operating profit was below our expectations, mainly driven by large increases in depreciation and amortization expenses. We reduce our operating profit forecasts around 20% in 2024, with the impact reducing in the outer-year forecasts, mainly due to increased depreciation and interest expenses. Our fair value estimate for LG Uplus reduces to KRW 9,700 from KRW11,400, leaving the stock on a 3-star rating. At our fair value estimate, the stock would trade on a 2024 price/earnings of only 7.4 times, with a 6.7% dividend yield. We see this as reasonable given our forecast for the company to grow its revenue by an average of 2.6% per year and its operating income by an average of 1.3% per year over the next five years. Our no-moat rating is retained given that LG Uplus has generated returns averaging below cost of capital over the past 10 years and we expect this to continue over our five-year explicit forecast period. LG Uplus has gradually taken market share in mobile, broadband, and pay-TV markets but remains in third position in terms of market share, with 20%-25% in each market. Given the high fixed cost nature of telecommunications, this puts LG Uplus at a slight disadvantage compared with its peers, KT Corp and SK Telecom, who've benefited from first-mover advantage but who also have no-moat ratings.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.

LG Uplus' first-quarter result was slightly positive at the top line, with services revenue growing 2.7% compared with our 2% full-year forecast, which is in line with company guidance. However, the operating profit decline of 15% was below our expectations and was mainly driven by large increases in depreciation and amortization expenses. We retain our operating profit forecasts and our KRW 11,400 fair value estimate. Management retains its guidance of 2% service revenue growth for 2024 with improved profitability and will retain its dividend payout ratio of 40% of net profit on a separate rather than consolidated basis. At our fair value estimate, the stock would trade at 2024 price/earnings of only 6.9 times with a 5.6% dividend yield. We see this as reasonable, given that we forecast the company to grow revenue by an average of 2.7% per year and operating income by an average of 2.6% per year over the next five years.

We expect LG Uplus to continue to grow its core business through the expansion of its wireless/wireline network, specifically its 5G broadband network, and expansion into targeted noncore businesses such as its smart home and enterprise infrastructure business segments. As LG Uplus expands its wireless network, it attracts premium 5G subscribers directly but also mobile virtual network operator subscribers. In addition, LG Uplus is investing in physical storefronts to drive its MVNO business. Revenue from roaming data usage is now back to prepandemic levels, due to the easing of covid-19 restrictions in Korea.