LG Uplus (032640) Q3 2025 earnings summary

Executive summary

• Q3 2025 saw solid earnings growth in the mobile business, with overall performance impacted by a one-off labor cost from an early/voluntary retirement package (ERP), leading to a 34.3% YoY drop in operating income.

• Excluding the ERP impact, operating profit continued its year-over-year uptrend, aligning with the first half trajectory.

• The company is accelerating digital transformation, focusing on AI-driven innovation and operational efficiency.

• Net income dropped 63.6% YoY to KRW 49.1bn, reflecting higher operating expenses and non-operating losses.

Financial highlights

• Q3 service revenue grew 4.2% YoY on both consolidated and separate bases, reaching KRW 3.1tn, led by wireless segment growth.

• Operating revenue for 3Q25 was KRW 4.01tn, up 5.5% YoY and 4.3% sequentially.

• Consolidated operating profit was KRW 161.7 billion, down 34.3% YoY; excluding ERP, it was KRW 311.7 billion, up 26.7% YoY.

• EBITDA for 3Q25 was KRW 831.3bn, down 9.7% YoY; EBITDA margin declined to 26.7%.

• CapEx for Q3 was KRW 438.1 billion, down 2.2% YoY.

Outlook and guidance

• Service revenue growth for 2025 is expected to exceed 2%, with Q3 cumulative growth at 2.8%.

• Q4 will focus on steady top-line growth, efficiency, and resource optimization, with AI adoption as a key driver.

• Cost savings from ERP (KRW 150 billion, 6% of headcount) are expected to improve profitability in 2026.

• Dividend increases are anticipated from 2026 as cost efficiencies materialize.

• ROE target set at 8–10% mid-to-long term, with value-up plan status to be disclosed in November 2025.