Form 20-F

As filed with the Securities and Exchange Commission on April 29, 202

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 20-F

(Mark One)

☐	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report

For the transition period from to

Commission file number

1-14418

SK Telecom Co., Ltd.

(Exact name of Registrant as specified in its charter)

SK Telecom Co., Ltd.

(Translation of Registrant’s name into English)

The Republic of

Korea

(Jurisdiction of incorporation or organization)

T-Tower

65, Eulji-ro,

Jung-gu,

Seoul 04539,

Korea

(Address of principal executive offices)

Mr. Chang-Gyu

Kim

65, Eulji-ro,

Jung-gu,

Seoul 04539,

Korea

Telephone No.:

+82-2-6100-1532

Facsimile No.:

82-2

6100-7830

(Name, telephone, email and/or facsimile number and address of company contact person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
American Depositary Shares, each representing five-ninths of one share of Common Stock	SKM	New York Stock Exchange
Common Stock, par value W 100 per share	SKM	New York Stock Exchang e*

*	No t for trading, but only in connection with the registration of the American Depositary Shares.

Securities registered or to be registered pursuant to Section 12(g) of the Act.

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

212,982,275 shares of common stock, par value

100 per share (not including 1,807,778 shares of common stock held by the company as treasury shares).

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

☒

☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes

☐

☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

☒

☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation

S-T

((§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes

☒

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in

Rule 12b-2

of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated

filer

☐

Emerging growth company

☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the cor

recti

on of an error to previously issued financial statements.

☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to

§240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP

☐

International Financial Reporting Standards as issued by the International Accounting Standards Board

☒

Other

☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in

Rule 12b-2

of the Exchange Act).

Yes

☐

☒


Auditor Name: KPMG Samjong Accounting Corp.		Auditor Location: Seoul, Korea		Auditor Firm ID: 1357

CERTAIN DEFINED TERMS AND CONVENTIONS USED IN THIS ANNUAL REPORT

All references to “Korea” contained in this annual report shall mean The Republic of Korea. All references to the “Government” shall mean the government of The Republic of Korea. All references to “we,” “us,” or “our” shall mean SK Telecom Co., Ltd. and, unless the context otherwise requires, its consolidated subsidiaries. References to “SK Telecom” shall mean SK Telecom Co., Ltd., but shall not include its consolidated subsidiaries. All references to “U.S.” shall mean the United States of America.

All references to “MHz” contained in this annual report shall mean megahertz, a unit of frequency denoting one million cycles per second. All references to “GHz” shall mean gigahertz, a unit of frequency denoting one billion cycles per second. All references to “Kbps” shall mean one thousand bits per second, all references to “Mbps” shall mean one million bits per second and all references to “Gbps” shall mean one billion bits per second. All references to “GB” shall mean gigabytes, which is one billion bytes. Any discrepancies in any table between totals and the sums of the amounts listed are due to rounding.

All references to “Won,” or “W” in this annual report are to the currency of Korea and all references to “Dollars,” “U.S. dollar” or “US$” are to the currency of the United States of America.

The Ministry of Science and ICT (the “MSIT”) is charged with regulating information and telecommunications, and the Korea Media and Communications Commission (the “KMCC”) is charged with regulating the public interest aspects of and fairness in broadcasting and telecommunications. Subscriber information for the wireless and fixed-line telecommunications industry set forth in this annual report is derived from information published by the MSIT unless expressly stated otherwise.

In the past, the MSIT published subscriber data for the Korean wireless telecommunications industry only in terms of wireless subscribers as a whole – which include subscribers to mobile phone services as well as non-mobile phone wireless services, such as for Internet-of-Things (“IoT”) devices, tablet computers, wearable devices and others – rather than for mobile phone service subscribers only. However, beginning as of December 31, 2023, the MSIT began to publish subscriber data also for mobile phone services only, which we believe is more meaningful for understanding our business. Accordingly, we have included in this annual report subscriber information for mobile phone service subscribers only from December 31, 2023, which is not comparable to corresponding information set forth in our annual reports for prior years, as the latter information related to wireless service subscribers as a whole.

The consolidated financial statements included in this annual report are prepared in accordance with International Financial Reporting Standards (“IFRS”) Accounting Standards, as issued by the International Accounting Standards Board (the “IASB”). As such, we make an explicit and unreserved statement of compliance with IFRS Accounting Standards, as issued by the IASB, with respect to our consolidated financial statements as of December 31, 2025 and 2024, and for the years ended December 31, 2025, 2024 and 2023, included in this annual report.

Unless expressly stated otherwise, all financial data included in this annual report are presented on a consolidated basis.

FORWARD-LOOKING STATEMENTS

This report contains “forward-looking statements,” as defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are based on our current expectations, assumptions, estimates and projections about our company and our industry. The forward-looking statements are subject to various risks and uncertainties. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “anticipate,” “believe,” “considering,” “depends,” “estimate,” “expect,” “intend,” “plan,” “planning,” “planned,” “project” and similar expressions, or that certain events, actions or results “may,” “might,” “should” or “could” occur, be taken or be achieved.

Forward-looking statements in this annual report include, but are not limited to, statements about the following:

•

our ability to anticipate and respond to various competitive factors affecting the telecommunications industry, including new services that may be introduced, changes in consumer preferences, economic conditions and discount pricing strategies by competitors;

•

our continued implementation of fifth generation wireless technology, which we refer to as “5G” technology, including through the development and implementation of an advanced version of 5G technology with higher data transmission speed and efficiency, which we refer to as “5G-Advanced” technology;

•

our plans for capital expenditures in 2026, including investments to maintain and enhance our telecommunications networks (including our 5G and fourth generation long-term evolution (“LTE”) networks), investments to improve and maintain our Wi-Fi network, investments in data infrastructure and computing capabilities, and investments in the development of artificial intelligence (“AI”), IoT and other digital solutions and services;

•

our efforts to expand and develop new growth businesses, including cloud computing, data center operations, AI-driven services, subscription-based services and other innovative services, as well as our efforts to integrate AI technologies into our existing telecommunications and digital service offerings and to create synergies across our business portfolio;

•

our ability to comply with governmental rules and regulations, including the regulations of the Government related to telecommunications providers, rules related to designation as a “market-dominating business entity” by the relevant authorities under the Korean Monopoly Regulation and Fair Trade Act (the “Fair Trade Act”) and the effectiveness of steps we have taken to comply with such regulations;

•

our ability to effectively manage our bandwidth and to timely and efficiently implement new bandwidth-efficient technologies and our intention to participate in, and acquire additional bandwidth pursuant to, frequency bandwidth auctions held, or other allocations of bandwidth, by the MSIT;

•

our expectations and estimates related to interconnection fees, rates charged by our competitors, regulatory fees, operating costs and expenditures, working capital requirements, principal repayment obligations with respect to long-term borrowings, bonds and short-term borrowings, and research and development expenditures and other financial estimates;

•

the success of our various joint ventures, investments, strategic alliances and cooperation efforts as well as other corporate restructuring activities, including the Spin-off (as defined below);

•

our ability to successfully attract and retain subscribers of our telecommunications-related businesses and customers of our other businesses; and

•

the growth of the telecommunications and other industries in which we operate in Korea and other markets and the effect that economic, political or social conditions have on our number of subscribers and customers and results of operations.

PART I

Item 1.

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Item 1.A.

Directors and Senior Management

Not applicable.

Item 1.B.

Advisers

Not applicable.

Item 1.C.

Auditors

Not applicable.

Item 2.

OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

Item 3.

KEY INFORMATION

Item 3.A.

[Reserved]

Item 3.B.

Capitalization and Indebtedness

Not applicable.

Item 3.C.

Reasons for the Offer and Use of Proceeds

Not applicable.

Item 3.D.

Risk Factors

Risks Relating to Our Business

Competition may reduce our market share and harm our business, financial condition and results of operations.

We face substantial competition across all of our businesses, including our wireless telecommunications business. We expect competition to remain intense as new technologies, products and services are developed and introduced by us and our competitors. We expect that such trends will continue to put downward pressure on the rates we can charge our subscribers.

Historically, there has been considerable consolidation in the telecommunications industry, resulting in the current competitive landscape comprising three mobile and fixed network operators in the Korean market, us, KT Corporation (“KT”) and LG Uplus Corp. (“LG U+”). Each of our competitors has substantial financial, technical, marketing and other resources to respond to our business offerings. As of December 31, 2025, the collective market share of KT and LG U+ amounted to approximately 58.4% in terms of number of mobile phone subscribers (including an aggregate of 15.1% attributable to mobile virtual network operators (“MVNOs”) that lease KT’s and LG U+’s respective networks). Our market share in 2025 was negatively affected by the impact of a cybersecurity incident, of which we became aware in April 2025, involving the leakage of certain universal subscriber identity module (“USIM”) information of our 5G and LTE network subscribers. See “—Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.”

Our competitors for subscriber activations include MVNOs, including MVNOs that lease our networks. MVNOs generally provide rate plans that are relatively cheaper than similar rate plans of the wireless network providers from which they lease their networks, including us. In recent years, a number of new entrants have entered the MVNO business, including affiliates of leading financial institutions in Korea. Some of these new entrants have engaged in aggressive marketing campaigns and promotional discounts while leveraging the brand power of their affiliates as part of their efforts to gain subscribers. Partly as a result of such efforts, the combined market share of MVNOs has generally increased in recent years, including from 15.5% as of December 31, 2023 to 16.9% as of December 31, 2024 and 18.3% as of December 31, 2025, in terms of number of mobile phone subscribers. In January 2025, the Government announced a number of new policy measures to strengthen the competitiveness of MVNOs, including lowering the cost of leasing networks from wireless network providers (including us) and providing support for the emergence of “full MVNOs” possessing their own core network infrastructures and telephone platform operations. We cannot assure you that such policy measures will not lead to further increases in the combined market share of MVNOs or encourage new MVNOs to enter the market.

In addition, other companies may enter the wireless network services market. For example, in January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X, a consortium led by Stage Five, an MVNO, to provide nationwide wireless network services. However, in July 2024, the Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application.

We believe that a continued increase in the market share of MVNOs (including through the entrance of new MVNOs, if any) and the entrance of new mobile network operators, if any, in the wireless telecommunications market may further increase competition in the telecommunications sector, as well as cause downward price pressure on the fees we charge for our services, which, in turn, may have a material adverse effect on our business, financial position and results of operations. See “— Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage” and “— Our businesses are subject to various types of Government regulation, and any change in Government policy relating to the telecommunications industry could have an adverse effect on our business, financial condition and results of operations.”

Our fixed-line telephone service competes with KT and LG U+, as well as other providers of voice over Internet protocol (“VoIP”) services. As of December 31, 2025, our market share of the fixed-line telephone and VoIP service market was 15.6% (including the services provided by SK Broadband Co., Ltd. (“SK Broadband”)) in terms of number of subscribers compared to KT with 51.6% and LG U+ with 18.1%. In addition, our broadband Internet access, Internet protocol TV (“IPTV”) and cable TV services provided through SK Broadband compete with other providers of such services, including KT, LG U+ and cable companies. Furthermore, our IPTV and cable TV services are facing an increasing level of competition from global operators of online video streaming platforms, such as YouTube, Netflix, Disney Plus and Apple TV, leading domestic video streaming platforms such as TVING, Coupang Play, Wavve (which is seeking to merge with TVING pursuant to a memorandum of understanding entered into in December 2023) and Watcha, and the video contents offered by leading domestic and global internet search, communications and social media platforms including NAVER, Kakao and Instagram, as such services continue to become increasingly popular to serve as a substitute to traditional television programming. As of December 31, 2025, our market share of the broadband Internet market was 28.7% in terms of number of subscribers compared to KT with 40.3% and LG U+ with 22.1%. As of December 31, 2025, our market share of the pay TV market (which includes IPTV, cable TV and satellite TV) was 25.9% compared to KT with 36.7% (including its IPTV, cable TV and satellite TV services) and LG U+ with 25.1% (including its IPTV and cable TV services), and the collective market share of other pay TV providers was 12.2%. Our market shares in the broadband Internet and pay TV markets in 2025 were also marginally and negatively affected by the impact of the above-mentioned cybersecurity incident, as a significant portion of our customers of these services subscribe to packages that combine our mobile phone services with one or both of these services.

Over the past decade, the Korean fixed-line telecommunications industry has gone through significant consolidation involving major pay television service providers. In April 2020, we completed the merger of Tbroad Co., Ltd., a former leading cable television and other fixed-line telecommunications services provider in Korea, and two of its subsidiaries, Tbroad Dongdaemun Broadcasting Co., Ltd. and Korea Digital Cable Media Center Co. Ltd. (collectively, “Tbroad”), with and into SK Broadband. In the same month, SK Telecom acquired a 55.0% equity interest in Broadband Nowon Co., Ltd. (formerly known as Tbroad Nowon Broadcasting Co., Ltd.), another subsidiary of Tbroad Co., Ltd., which was subsequently merged with and into SK Broadband in October 2022. Following such transactions (the “Tbroad Merger”), we have become the second-largest pay TV provider in Korea in terms of number of subscribers as of December 31, 2025. In November 2024, in order to enhance management efficiency and strengthen our control over SK Broadband, we entered into an agreement to acquire an additional 24.8% equity interest in SK Broadband from minority shareholders. Such transaction was completed in May 2025. We owned approximately 99.1% of SK Broadband’s total outstanding shares as of December 31, 2025. Furthermore, in March 2026, in order to enhance management efficiency and strengthen enterprise value through greater strategic flexibility, we entered into an agreement to acquire the remaining 0.9% equity interest in SK Broadband from minority shareholders. Such transaction is currently pending subject to regulatory approval and other customary closing conditions. In December 2019, LG U+ acquired a majority equity stake in CJ Hello Co., Ltd. and changed the acquired company’s name to LG HelloVision Co., Ltd. (“LG HelloVision”). In August 2021, KT acquired HCN Co., Ltd. (“HCN”), a major Korean cable TV service provider, through its subsidiary KT Skylife Co., Ltd. (“KT Skylife”). Such transactions, as well as further consolidation in the fixed-line telecommunications industry, may result in increased competition, as the entities emerging from such consolidation and other remaining players in the industry may actively pursue expanding or protecting their respective market shares.

Continued competition from other wireless and fixed-line telecommunications service providers has also resulted in, and may continue to result in, deactivations among our subscribers. A substantial level of subscriber deactivations, or churn, may significantly harm our business, financial condition and results of operations. In 2025, the monthly churn rate in our wireless telecommunications business ranged from 0.7% to 2.3%, with an average monthly churn rate of 1.1%, which increased from 0.8% in 2024, mainly due to the cybersecurity incident of which we became aware in April 2025 as described above. Intensification of competition in the future may cause our churn rates to increase, which in turn may cause us to increase our marketing expenses as a percentage of sales to attract and retain subscribers. In December 2024, the National Assembly passed a bill to abolish the Mobile Device Distribution Improvement Act (the “MDDIA”), which limits the amount of handset subsidies a wireless telecommunications service provider can provide to subscribers in order to prevent excessive competition in the market, and the MDDIA was repealed in July 2025. While we will continue to strive to cautiously balance our market share and profitability margins, we cannot assure you that the abolishment of the MDDIA, which has allowed wireless telecommunications service providers to provide handset subsidies without limitation, will not intensify market competition or increase our marketing expenses. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation” below.

As we continue to expand our business into areas beyond the traditional wireless and fixed-line telecommunications businesses, we also face competition from major players in the relevant sectors, such as cloud services, data center services, online commerce and television shopping (“T-commerce”). Some of our competitors may have stronger brand recognition, more robust technological capabilities and/or more significant financial resources than us in their respective areas of business.

Our ability to compete successfully in all of the businesses in which we operate will depend on our ability to anticipate and respond to various competitive factors affecting the respective industries, including new services that may be introduced, changes in consumer preferences, economic conditions and discount pricing strategies by competitors.

Inability to successfully implement or adapt our network and technology to meet the continuing technological advancements affecting the wireless telecommunications industry will likely have a material adverse effect on our business, financial condition and results of operations.

The telecommunications industry has been characterized by continued improvements and advances in technology, and this trend is expected to continue. We and our competitors have continually implemented technology upgrades from previous generations of prevailing network technology, including the basic code division multiple access (“CDMA”) and wideband code division multiple access (“WCDMA”) networks, to the currently dominant LTE and 5G networks. Our business could be harmed if we fail to implement, or adapt to, future technological advancements in the telecommunications sector in a timely manner, such as the further enhancement of 5G technology (including through the development and implementation of 5G-Advanced technology) and the development and implementation of an eventual successor technology to 5G technology. We launched wireless service plans using the 5G network in April 2019 following the commencement of sales of the first 5G-compatible smartphones, and we continue to maintain and enhance our 5G network coverage. We currently provide full nationwide 5G network coverage across outdoor terrestrial areas and subway lines, and substantially full nationwide 5G network coverage in large buildings. KT and LG U+ also rolled out their respective 5G wireless service plans in April 2019. The more successful operation of a 5G network or development of improved 5G technology by a competitor, including better market acceptance or network quality of a competitor’s 5G services, could materially and adversely affect our existing wireless telecommunications businesses as well as the returns on future investments we may make in our 5G network or our other businesses.

In addition to introducing new technologies and offerings, we must phase out outdated and unprofitable technologies and services. For example, we discontinued our wireless broadband Internet access (“WiBro”) services in January 2019 and our second generation CDMA wireless services in July 2020. If we are unable to introduce new technologies and offerings on a cost-effective and timely basis, our business, financial condition and results of operations could be adversely affected.

Implementation of new wireless technology and enhancement of existing wireless technology have required, and may continue to require, significant capital and other expenditures, which we may not recoup.

We have made, and intend to continue to make, capital investments to develop, launch and enhance our wireless service. In 2025, 2024 and 2023, we spent Won 733.9 billion, Won 1,259.0 billion and Won 1,380.6 billion, respectively, in capital expenditures to build and enhance our wireless networks. We plan to make further capital investments related to our wireless services in the future, including services that can potentially leverage our 5G network and enhance the service quality of our 5G network, including through the development and application of AI technology. In addition, we plan to continue maintaining and enhancing our 5G network (including through the development and implementation of 5G-Advanced technology) as described above, while also maintaining our LTE network, which we expect will continue to be used by a material portion of our subscriber base in the near future, despite the ongoing migration of wireless service users to our 5G network. Our wireless technology-related investment plans are subject to change, and will depend, in part, on market demand for 5G and LTE services, the competitive landscape for provision of such services and the development of competing technologies. There may not be sufficient demand for services based on our latest wireless technologies, as a result of competition or otherwise, to permit us to recoup or profit from our wireless technology-related capital investments.

Our businesses are subject to various types of Government regulation, and any change in Government policy relating to the telecommunications industry could have an adverse effect on our business, financial condition and results of operations.

Our businesses are generally subject to governmental supervision and various types of regulation.

Rate Regulation. The Government has periodically reviewed the rates charged by wireless telecommunications service providers and has, from time to time, released public policy guidelines or suggested

rate reductions. Although these guidelines or suggestions were not binding, we have implemented some rate reductions in response to them. For example, under the MDDIA, wireless telecommunications service providers were obliged to provide certain benefits, such as discounted rates, to subscribers who subscribe to their service without receiving subsidies. In June 2017, the State Affairs Planning Advisory Committee of Korea announced that it would encourage wireless telecommunications service providers, including us, to increase the applicable discount rate offered to subscribers from 20% to 25%, which we adopted in September 2017, and to offer additional discounts to low income customers, including those on government welfare programs and senior citizen recipients of the basic pension, which we implemented in December 2017 and July 2018, respectively. Although the MDDIA was repealed in July 2025, discounted rates offered under the MDDIA have been retained through a related amendment to the Telecommunications Business Act. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation” and “Item 5.A. Operating Results — Overview — Rate Regulations.” Such discounts have contributed to a general decrease in the monthly revenue per subscriber of our wireless telecommunications services. See “Item 5.A. Operating Results — Overview — Decrease in Monthly Revenue per Subscriber.” In July 2022, the MSIT requested wireless telecommunications service providers, including us, to introduce additional mid-tier 5G rate plans to provide 5G subscribers with more diverse and affordable rate plans that better meet their data usage patterns. We have since introduced several types of such new plans in 2022 and 2023. In November 2023, the MSIT requested wireless telecommunications service providers, including us, to provide 5G smartphone users with the option to subscribe to LTE rate plans, which we implemented in the same month. In addition, in January 2024, the MSIT requested wireless telecommunications service providers, including us, to introduce low-tier 5G rate plans priced under Won 40,000 per month, which we implemented in March 2024. In October 2024, during the National Assembly’s audit of the MSIT, concerns were raised about LTE rate plans that are more expensive or offer fewer benefits compared to 5G rate plans. We have since reviewed this concern and suspended new subscriptions for some of our LTE rate plans starting in February 2025. The Government may suggest other policy initiatives relating to rate plans of wireless telecommunications service providers in the future, and any further changes to our rate plans we make in response to such suggestion may adversely affect our profitability and results of operations.

Technology Standards. The Government also plays an active role in setting the timetable and quality standards for the adoption and implementation of new technologies to be used by telecommunications operators in Korea. For example, the Government provided such guidance in connection with the introduction of LTE and 5G technologies in the past. The Government may provide similar guidance or recommendations in connection with the adoption and implementation of technologies to be used in future telecommunications services, and it is possible that adherence to such guidance or recommendations promoted by the Government in the future may not provide us with the best commercial returns.

Frequency Allocation. The Government sets the policies regarding the use of frequencies and allocates the spectrum of frequencies used for wireless telecommunications. See “Item 4.B. Business Overview — Law and Regulation — Frequency Allocation.” The reallocation of the spectrum to our existing competitors or a new entrant to the wireless telecommunications business could increase competition among wireless telecommunications service providers, which may have an adverse effect on our business, financial condition and results of operations. See “— Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage.”

MVNOs. Pursuant to the Telecommunications Business Act, certain wireless telecommunications service providers designated by the MSIT, which currently includes only us, are required to lease their networks or allow use of their networks (collectively, a “wholesale lease”) by other network service providers, such as an MVNO, that have requested such a wholesale lease in order to provide their own services using the leased networks. Currently, 15 MVNOs provide wireless telecommunications services using the networks leased from us. We believe that leasing a portion of our bandwidth capacity to an MVNO impairs our ability to use our bandwidth in ways that would generate maximum revenues and strengthens our MVNO competitors by granting them access

and lowering their costs to enter into and operate in our markets. Accordingly, our profitability has been, and may continue to be, adversely affected.

Interconnection. Our wireless telecommunications services depend, in part, on our interconnection arrangements with domestic and international fixed-line and other wireless networks. Our interconnection arrangements, including the interconnection rates we pay and interconnection rates we charge, affect our revenues and operating results. The MSIT determines the basic framework for interconnection arrangements, including policies relating to interconnection rates in Korea. Such basic framework for interconnection arrangements has been changed several times in the past, and we cannot assure you that we will not be adversely affected by the MSIT’s interconnection policies and future changes to such policies. See “Item 4.B. Business Overview — Interconnection — Domestic Calls.”

Regulatory Action. The MSIT may revoke our licenses or suspend any of our businesses if we fail to comply with its rules, regulations and corrective orders, including the rules restricting beneficial ownership and control or any violation of the conditions of our licenses. Alternatively, in lieu of suspension of our business, the MSIT may levy a penalty surcharge of up to 3.0% of the average of our annual revenue for the preceding three fiscal years. Such penalties, which may include the revocation of cellular licenses, suspension of business or imposition of penalty surcharges by the MSIT, could have a material adverse effect on our business. We believe that we are currently in compliance with the material terms of all of our cellular licenses.

AI Technology. In January 2025, in light of the increasing proliferation of AI technology in both the private and public sectors, the National Assembly enacted the Framework Act on the Development of Artificial Intelligence and the Creation of a Foundation for Trust, which seeks to regulate the risks of the use of AI technology while also promoting the growth of AI-related industries in Korea. Such new law became effective on January 22, 2026, and the Government promulgated more detailed regulations relating to the safety and reliability of AI-generated information and the handling of user data, among other things, on the same day.

In addition, the Fair Trade Act provides for various regulations and restrictions enforced by the Korea Fair Trade Commission (the “KFTC”) to prohibit or restrict actions that impede competition and fair trade. From time to time, we have been, and may in the future be, subject to investigations by the KFTC relating to potential violations of such laws and regulations. See “Item 8.A. — Consolidated Statements and Other Financial Information — Legal Proceedings — KFTC Proceedings.” Any future determination by the KFTC that we have engaged in transactions that violate the fair trade laws and regulations may result in fines or other punitive measures and may have a material adverse effect on our business.

On March 12, 2026, the National Assembly passed a resolution to amend the Act on Promotion of Information and Communications Network Utilization and Information Protection. The amendments were promulgated on March 31, 2026, and will take effect beginning on October 1, 2026, except as otherwise provided for certain provisions. The amendments will require certain information and communications service providers to secure adequate personnel and budget for information security, establish an information security committee and strengthen the role and responsibilities of the chief information security officer. The amendments will also authorize the MSIT to periodically assess the stability and reliability of information and communications networks, impose notification obligations on service providers in the event of certain cybersecurity incidents and expand the scope of incident investigations and analyses. In addition, the amendments will require the establishment of a cybersecurity incident review committee under the MSIT and introduce administrative surcharges for repeated cybersecurity incidents.

On February 12, 2026, the plenary session of the National Assembly passed amendments to the Personal Information Protection Act to strengthen regulations relating to personal data protection. The amendments clarified that business operators and their chief executives bear ultimate responsibility for the processing and protection of personal information and strengthened the role and responsibilities of the chief privacy officer. The amendments also expand notification obligations to data subjects to include not only the loss, theft or leakage of

personal information but also its falsification, alteration or damage, and impose notification requirements in certain cases where there is a risk of personal data leakage. The amendments also require personal information controllers of companies that meet certain criteria to be set out in the Presidential Decree based on factors, such as revenue and the scale of personal data processing, to obtain Personal Information & Information Security Management System (“ISMS-P”) certification. In addition, the amendments strengthen enforcement measures by allowing administrative surcharges of up to 10% of total revenue to be imposed in cases involving repeated or large-scale personal data breaches caused by willful misconduct or gross negligence. These amendments were promulgated on March 10, 2026, and will take effect on September 11, 2026. The requirement to obtain ISMS-P certification is scheduled to take effect on July 1, 2027.

Our cost of compliance with, and any determination by the Government that we are in violation of, these or any other new laws and regulations that relate to our business and operations may have an adverse effect on our business, financial condition and results of operations.

We are subject to additional regulations as a result of our dominant market position in the wireless telecommunications sector, which could harm our ability to compete effectively.

The Government endeavors to promote competition in the Korean telecommunications markets through measures designed to prevent a dominant service provider from exercising its market power and deterring the emergence and development of viable competitors. We have been designated by the MSIT as the “dominant network service provider” in respect of our wireless telecommunications business. As such, we are subject to additional regulations to which certain of our competitors are not subject. For example, the MSIT has fifteen days to object to any new rates and terms of service reported by us. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation.”

We may also be designated as a “market-dominating business entity” by the relevant authorities under the Fair Trade Act, based on a case-by-case assessment of factors such as our market share, barriers to entry and the relative scale of competitors. If so designated, we would be subject to additional regulations, including restrictions on engaging in conduct that could be deemed an abuse of such position. See “Item 4.B. Business Overview — Law and Regulation — Competition Regulation.” The additional regulations to which we are subject have affected our competitiveness in the past and may materially hurt our profitability and impede our ability to compete effectively against our competitors in the future.

We may fail to successfully complete, integrate or realize the anticipated benefits of our new businesses, joint ventures or other strategic alternatives or corporate reorganizations, and such transactions may negatively impact our business.

We continue to seek opportunities to develop new businesses that we believe are complementary to our existing product and service portfolio and expand our global business through selective acquisitions. We also continue to seek ways to optimize our corporate structure to maximize the value of our traditional businesses on the one hand and newly developed businesses on the other hand. Accordingly, we are often engaged in evaluating potential transactions and other strategic alternatives as well as corporate reorganizations, some of which may be significant in size.

For example, we completed the Tbroad Merger in April 2020, following which we became the second-largest pay TV provider in Korea in terms of number of subscribers as of December 31, 2025. Moreover, in February 2022, in order to strengthen our online distribution capabilities and explore synergies with our other businesses in the information and communications technologies (“ICT”) sector, we indirectly re-acquired a 100.0% equity interest in SK m&service Co., Ltd. (“SK M&Service”), which provides online corporate employee benefits management and training services for Korean businesses and public institutions, through our wholly-owned subsidiary PS&Marketing Corporation (“PS&Marketing”), from SK Planet. However, as part of our efforts to increase our operational efficiency and re-balance our business areas, we entered into agreements

with Samgu Inc. and its affiliates in December 2024 to dispose of a 70% equity interest in SK M&Service, as well as our 100% equity interest in our former wholly-owned subsidiary NATE Communications Corporation (formerly known as SK Communications Co., Ltd.), which operates the “Nate” internet portal, and the entirety of our 50% equity interest in our former associate F&U Credit Information Co., Ltd. (“F&U Credit Information”), which provides credit information services. The disposals of NATE Communications Corporation, SK M&Service and F&U Credit Information were completed in January 2025, February 2025 and April 2025, respectively.

In December 2025, we entered into an agreement to sell our entire equity stake in SK stoa Co., Ltd. (“SK Stoa”), which operates our T-commerce business, and Media S Co., Ltd. (“Media S”), which operates two TV channels and co-produces original television entertainment contents, to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions.

We have also pursued other strategic alternatives, such as entering into a strategic alliance in July 2022 with Hana Financial Group Inc. (“Hana Financial Group”), a leading financial holding company in Korea with subsidiaries having significant presences in commercial banking, credit card business, securities brokerage and insurance, among others, to seek synergies through convergence between finance and ICT technology. As part of such strategic alliance, we transferred the entirety of our 15.0% interest in HanaCard Co., Ltd. (“HanaCard”), a leading credit card company in Korea and a subsidiary of Hana Financial Group, for Won 330.0 billion in July 2022 and acquired 8,630,949 shares of Hana Financial Group (representing a 2.9% interest) for Won 330.0 billion between July and November 2022, and HanaCard acquired 1,307,471 common shares of us (representing a 0.6% interest) for Won 68.4 billion between July and September 2022.

Effective as of November 1, 2021, we conducted a horizontal spin-off (the “Spin-off”) of our businesses related to the management of our equity interests in certain subsidiaries and investees (the “Spin-off Portfolio Companies”) engaged in the semiconductor and certain other non-telecommunications businesses, including security, e-commerce and other new ICT businesses (the “Spin-off Businesses”). The Spin-off was accomplished through the establishment of a new company named SK square Co., Ltd. (“SK Square”), to which our equity interests in the Spin-off Portfolio Companies were transferred, and we distributed SK Square’s shares of common stock on a pro rata basis to the holders of our common stock.

We have been actively emphasizing the development and utilization of AI technologies across our businesses and operations to enhance competitiveness, drive innovation and improve operational efficiency. In September 2025, we consolidated our AI-related business units into a centralized internal organization, which we refer to as the “AI Company-in-Company (“CIC”),” to drive more efficient and focused growth of our AI-related businesses. See “Item 5.A. Operating Results — Overview — Operational Efficiency.” We have also been collaborating with leading Korean AI technology companies as well as other global telecommunications companies, including by making various strategic investments in leading AI technology companies in recent years to facilitate mutual collaboration. For a detailed description of our recent investments in new businesses, including those relating to the field of AI technology, see “Item 4.B. Business Overview — Cellular Services — Other Solutions and Services — Other New Businesses” and “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Investments in New Growth Businesses.”

While we are hoping to benefit from a range of synergies and efficiencies from our recent or future acquisitions, strategic investments and corporate reorganizations as well as our development and integration of new businesses and technologies, we may not be able to successfully complete or integrate such acquisitions, strategic investments, new businesses or technologies, or reorganized entities and may fail to realize their expected benefits in the near term, or at all. In addition, when we enter into new businesses with partners through joint ventures or other strategic alliances, we and those partners may have disagreements with respect to strategic directions or other aspects of business, or may otherwise be unable to coordinate or cooperate with each other, any of which could materially and adversely affect our operations in such businesses. Our business may be negatively impacted if we fail to successfully integrate or realize the anticipated benefits of such transactions.

Due to the existing high penetration rate of mobile phones in Korea, we are unlikely to maintain our subscriber growth rate, which could adversely affect our business, financial condition and results of operations.

According to data published by the MSIT and the historical population data published by the Ministry of the Interior and Safety, the penetration rate of mobile phones in Korea as of December 31, 2025 was approximately 110.6%, which was relatively high compared to many industrialized countries. Therefore, we expect that the penetration rate of mobile phones in Korea will remain relatively stable. As a result of the already high penetration rate of mobile phones in Korea coupled with our leading market share and a declining trend in the population size of Korea, we expect our subscriber growth rate to decrease. Slowed growth or any future decrease in the number of subscribers without a commensurate increase in revenues through the introduction of new services and increased use of our services by existing subscribers would likely have a material adverse effect on our business, financial condition and results of operations.

Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage.

One of the principal limitations on a wireless network’s subscriber capacity is the amount of frequency spectrum available for use by the network. We have acquired a number of frequency usage rights to secure bandwidth capacity to provide our broad range of services, for which we typically make an initial payment as well as pay usage fees during the license period. We made frequency usage right fee payments of Won 99.8 billion in 2025, Won 103.0 billion in 2024 and Won 102.5 billion in 2023. For more information regarding the various bandwidths that we use and the usage right fees for such bandwidths, see “Item 4.B. Business Overview — Law and Regulation — Frequency Allocation,” “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures” and note 16 of the notes to our consolidated financial statements.

The growth of our wireless data businesses has been a significant factor in the increased utilization of our bandwidth, since wireless data applications are generally more bandwidth-intensive than voice services. In

particular, the continued increase in popularity of smartphones and data intensive applications among smartphone users has been a major factor for the high utilization of our bandwidth in recent years. Although such trend has been offset in part by the implementation of new technologies that enable more efficient usage of our bandwidth, we expect that the current trend of increased data transmission use by our subscribers will continue to accelerate in the near future as more subscribers migrate to our 5G network and the volume and sophistication of the multimedia content we offer through our wireless data services continue to grow in the 5G environment. While we believe that we can address the capacity constraint issue through system upgrades and efficient allocation of bandwidth, inability to address such capacity constraints in a timely manner may adversely affect our business, financial condition and results of operations. In the event we are unable to maintain sufficient bandwidth capacity, our subscribers may perceive a general slowdown of wireless telecommunications services. Growth of our wireless telecommunications business will depend in part upon our ability to effectively manage our bandwidth capacity and to implement efficiently and in a timely manner new bandwidth-efficient technologies if they become available. We cannot assure you that bandwidth constraints will not adversely affect the growth of our wireless telecommunications business.

In 2021, the MSIT reallocated a total of 310 MHz of frequency bandwidths to KT, LG U+ and us, 95 MHz (in the 800 MHz, 2.1 GHz and 2.6 GHz spectrums) of which was allocated to us. See “Item 5.B. Liquidity and Capital Resources — Capital Requirements.” In December 2022, citing the lack of progress made to date with respect to the implementation of 5G infrastructure for our use of the 28 GHz spectrum (800 MHz of bandwidth which was allocated to us in December 2018 for a period of five years until November 2023), the MSIT reduced the duration of our license for the use of such bandwidth by six months and asked us to install 15,000 base stations that use the 28 GHz spectrum by the end of May 2023, which we were not able to do within the Government’s requested timetable. While we do not believe that the loss of such allocated bandwidth have had or will have a material adverse effect on our business, we cannot assure you that we will be able to reacquire such bandwidth in the future or that the failure to reacquire such bandwidth will not adversely affect our future prospects. Furthermore, in December 2022, the Government cancelled the allocations of bandwidth in the 28 GHz spectrum that had been provided to KT and LG U+, also citing the lack of progress made by these companies. In January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X to provide nationwide wireless network services. However, in July 2024, the Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application.

We may be required to pay a substantial amount to acquire additional bandwidth capacity in the future in order to meet increasing bandwidth demand or renew the rights to use our existing bandwidth, and we may not be successful in acquiring the necessary bandwidth to meet such demand at commercially attractive terms or at all, which may adversely affect our business, financial condition and results of operations. In particular, the rights to use certain of our existing frequency bandwidths are due to expire within 2026, including 20 MHz in the 800 MHz spectrum in June 2026 and an aggregate of 135 MHz in the 1.8 GHz, 2.1 GHz and 2.6 GHz spectrums in December 2026. We have applied for the renewal of the 20 MHz frequency bandwidth in the 800 MHz spectrum in December 2025, and we plan to apply for the renewal of the remaining 135 MHz of frequency bandwidths in June 2026. The final consideration to be paid by us for such reallocated bandwidths is expected to be conditional on the number of indoor 5G cell sites to be constructed by us by 2031. While we do not have any material reasons to believe that our renewal efforts will not be successful, any failure or delay in obtaining such renewal on economically viable terms or at all for any reason may have an adverse impact on our business, financial condition and results of operations.

We rely on key technology professionals and senior management, and the loss of the services of any such personnel or the inability to attract and retain them may negatively affect our business.

Our success depends to a significant extent on the continued service of our research and development and engineering personnel, and our ability to continue to attract, retain and motivate qualified technology professionals including researchers and engineers. In particular, our focus on leading the market in introducing

new services has meant that we must aggressively recruit technology professionals with expertise in cutting-edge technologies. Such employees are in high demand, and we devote significant resources to identifying, hiring, training, successfully integrating and retaining these employees. Competition for these individuals could cause us to offer higher compensation and other benefits to attract and retain them. We also depend on the services of experienced key senior management, and if we lose their services, it would be difficult to find and integrate replacement personnel in a timely manner, or at all.

The loss of the services of any of our key technology professionals or senior management without adequate replacement, or the inability to attract new qualified personnel, would have a material adverse effect on our results of operations.

We need to observe certain financial and other covenants under the terms of our debt instruments, the failure to comply with which would put us in default under those instruments.

Certain of our debt instruments contain financial and other covenants with which we are required to comply on an annual and semi-annual basis. The financial covenants with respect to SK Telecom’s debt instruments include, but are not limited to, a maximum net debt-to-EBITDA ratio of 3.50 and a minimum EBITDA-to-total interest expense ratio of 4.00, each as determined on a separate financial statement basis. The debt arrangements also contain negative pledge provisions limiting our ability to provide liens on our assets as well as cross-default and cross-acceleration clauses, which give related creditors the right to accelerate the amounts due under such debt if an event of default or acceleration has occurred with respect to our existing or future indebtedness, or if any material part of our indebtedness or indebtedness of our subsidiaries is capable of being declared payable before the stated maturity date. In addition, such covenants restrict our ability to raise future debt financing.

If we breach our financial or other covenants, our financial condition will be adversely affected to the extent we are not able to cure such breaches or repay the relevant debt.

We may have to make further financing arrangements to meet our capital expenditure requirements and debt payment obligations.

We have had, and expect to continue to have, significant capital expenditure requirements as we continue to build out, maintain and upgrade our networks and invest in businesses that complement our wireless and fixed-line telecommunications businesses. We spent Won 2,206.6 billion for capital expenditures in 2025. We currently expect to spend a slightly higher amount for capital expenditures in 2026 compared to 2025 for a range of projects, including investments to maintain and enhance our telecommunications networks (including our 5G and LTE networks), investments to improve and maintain our Wi-Fi network, investments in data infrastructure and computing capabilities, and investments in the development of AI, IoT and other digital solutions and services. Such projects also include other initiatives related to the development of new growth businesses and our ongoing businesses in the ordinary course, in each case with an emphasis on incorporating AI technology into our various existing and new business areas. However, our overall capital expenditure levels and the allocation of such expenditures remain subject to many uncertainties. We may increase, reduce or suspend our planned capital expenditures for 2026 or change the timing and area of our capital expenditure spending from the estimates described above in response to market conditions or for other reasons. We may also make additional capital expenditures and other investments beyond our currently anticipated level as opportunities arise, including in relation to any acquisitions of additional frequency usage rights or execution of additional AI-related investments.

In particular, we continue to make significant capital investments to maintain and upgrade our wireless networks in response to growing bandwidth demand by our subscribers. Bandwidth usage by our subscribers has rapidly increased in recent years primarily due to the increasing number of data intensive mobile applications and use of such applications by smartphone users. If heavy usage of bandwidth-intensive services grows beyond our current expectations, we may need to invest more capital than is currently anticipated to expand the bandwidth

capacity of our networks or our customers may experience suboptimal performance when using our services. Any of these events could adversely affect our competitive position and have a material adverse effect on our business, financial condition and results of operations. For a more detailed discussion of our capital expenditure plans and a discussion of other factors that may affect our future capital expenditures, see “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures.”

As of December 31, 2025, we had Won 2,350.2 billion in contractual payment obligations (excluding short-term leases and leases of low-value assets) due in 2026, which mostly involved repayment of debt obligations and payments related to lease liabilities and frequency licenses. See “Item 5.B. Liquidity and Capital Resources — Contractual Obligations and Commitments.”

We have not arranged firm financing for all of our current or future capital expenditure plans and contractual payment obligations. We have, in the past, obtained funds for our proposed capital expenditure and payment obligations from various sources, including our cash flow from operations as well as from financings, primarily debt and equity financings. Any material adverse change in our operational or financial condition could impact our ability to fund our capital expenditure plans and contractual payment obligations. Volatile financial market conditions and an increasing interest rate environment may also curtail our ability to obtain adequate funding and/or increase our cost of borrowings, which would have an adverse effect on our liquidity and financial position. Inability to fund such capital expenditure requirements may have a material adverse effect on our business, financial condition and results of operations. In addition, although we currently anticipate that the capital expenditure levels estimated by us will be adequate to meet our business needs, such estimates may need to be adjusted based on developments in technology and markets. Failure to meet any such increased expenditure requirements or to obtain adequate financing for such requirements on terms acceptable to us, or at all, may have a material adverse effect on our business, financial condition and results of operations.

Termination or impairment of our relationship with a small number of key suppliers for network equipment and for leased lines could adversely affect our business, financial condition and results of operations.

We purchase wireless network equipment from a small number of suppliers. To date, we have purchased substantially all of the equipment for our networks from Samsung Electronics Co., Ltd. (“Samsung Electronics”), Ericsson-LG Co., Ltd. (“Ericsson-LG”) and Nokia Corporation (“Nokia”). In addition, we purchase a substantial majority of our wireless devices from Samsung Electronics and Apple. Although other manufacturers sell the equipment we require, sourcing such equipment from other manufacturers could result in unanticipated costs in the maintenance and enhancement of our wireless networks. Inability to obtain the equipment needed for our networks in a timely manner may have an adverse effect on our business, financial condition and results of operations.

We cannot assure you that we will be able to continue to obtain the necessary equipment from one or more of our suppliers. Any discontinuation or interruption in the availability of equipment from our suppliers for any reason could have an adverse effect on our business, financial condition and results of operations. In addition, inability to lease adequate lines at commercially reasonable rates may impact the quality of the services we offer and may also damage our reputation and our business.

Our business relies on technology developed by us, and our business will suffer if we are unable to protect our proprietary rights.

We own numerous patents and trademarks worldwide, and have applications for patents pending in many countries. In addition to active research and development efforts, our success depends in part on our ability to obtain patents and other intellectual property rights covering our services.

We may be required to defend against charges of infringement of patent or other proprietary rights of third parties. Although we have not experienced any significant patent or other intellectual property disputes, we

cannot be certain that any significant patent or other intellectual property disputes will not occur in the future. Defending our patent and other proprietary rights could require us to incur substantial expense and to divert significant resources of our technical and management personnel, and could result in our loss of rights to employ certain technologies to provide services.

Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.

Our business involves the storage and transmission of large amounts of personal information, and cybersecurity breaches expose us to a risk of loss of this information, which may lead to improper use or disclosure of such information, ensuing potential liability and litigation, and loss of customers, any of which could harm our reputation and adversely affect our business.

We maintain a comprehensive process for assessing, identifying and managing material risks from cybersecurity threats as part of our overall risk management system and processes. See “Item 16K. Cybersecurity.” Instituting appropriate access controls and safeguards across all of our information technology infrastructure is challenging. Furthermore, outside parties may attempt to fraudulently induce employees to disclose personal or confidential information in order to gain access to our data or our customers’ data or accounts, or may otherwise obtain access to such data or accounts. Because the techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently and often are not recognized until attacks are launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures.

On April 18, 2025, we became aware of a malware attack against our information technology infrastructure, which resulted in the leakage of certain USIM information of our 5G and LTE network subscribers. Upon becoming aware of such incident, we promptly deleted the malware and segregated the targeted equipment, and we have yet to find any instance of actual or attempted misuse of such information. We also alerted the Government authorities and our customers of such attack, and promptly took further measures to mitigate the potential impact of such attack, including by engaging in a comprehensive audit of our entire network system, strengthening our monitoring efforts against USIM swap frauds and unauthorized authentication attempts, and offering free USIM protection services and free replacement of USIM cards to our subscribers to block any unauthorized misuse of their USIM information, while also cooperating with Government authorities in their investigations of this incident. From May 5, 2025 to June 23, 2025, we temporarily suspended new subscriptions of mobile phone services to alleviate the shortage of USIM card replacement inventory in accordance with administrative guidance from the MSIT. Furthermore, on July 4, 2025, in order to reaffirm our commitment and restore customer trust, we announced the “Accountability and Commitment Program” consisting of the “Customer Assurance Package,” “Information Protection Innovation Plan,” “Customer Appreciation Package” and “Subscription Cancellation Fee Waiver.” Under the Customer Assurance Package, we have been providing free subscriptions to a leading third-party mobile device security solution for all customers for one year beginning in November 2025, among other things. Under the Information Protection Innovation Plan, we announced our intent to invest approximately Won 700 billion over the course of the next five years to strengthen our cybersecurity technology, infrastructure and personnel. Under the Customer Appreciation Package, we provided a range of economic benefits to our customers totaling approximately Won 500 billion in value during the second half of 2025. Such benefits included discounts on monthly subscription fees for the month of August 2025 and free additional mobile data until the end of 2025, as well as significant membership discounts redeemable at our various partnering merchants and special benefits for returning customers, in each case subject to applicable terms and conditions. Under the Subscription Cancellation Fee Waiver, we waived the subscription cancellation fees for customers who canceled their subscriptions between April 19, 2025 (which was the date of the public announcement of the cybersecurity incident) and July 14, 2025. The number of our mobile phone subscribers decreased by approximately 0.73 million over such period. In August 2025, the Telecommunications Dispute Resolution Committee under the KMCC recommended that we waive cancellation fees through year-end and reduce bundled wireless and fixed-line telecommunications service cancellation fees by 50%. We declined this recommendation in September 2025.

On August 27, 2025, the Personal Information Protection Commission of Korea (the “PIPC”) imposed a fine of Won 134.8 billion and an administrative penalty of Won 9.6 million and issued a correctional order on us in connection with this incident. While we have provisionally paid the fine and the administrative penalty in full, we filed an administrative lawsuit challenging such decision in January 2026, which case is currently pending before the Seoul Administrative Court. In addition, certain of our mobile phone service subscribers have sought dispute mediation with relevant authorities to make damage claims in connection with their alleged losses relating to the incident. To date, we have declined to accept the authorities’ proposed settlements. See “Item 8.A. Consolidated Statements and Other Financial Statements — Legal Proceedings — Other Proceedings.” Certain of our mobile phone service subscribers have also filed a number of civil lawsuits seeking alleged damages in connection with this incident, all of which are currently pending before trial courts. While we are vigorously defending ourselves in each of these cases, we are unable to predict their outcomes, and no assurance can be made that additional customers will not pursue additional legal actions to seek alleged damages against us in connection with this incident.

Actual or perceived breaches of our cybersecurity of a material nature, or material harm to the market perception of the effectiveness of our cybersecurity measures may require us to incur significant legal and financial exposure, including legal claims and regulatory fines and penalties, monetary compensation to our customers, damage to our reputation and a loss of confidence of our customers, which could have a material adverse effect on our business, financial condition and results of operations.

In addition, in the event of common malicious and abusive Internet activities, such as unsolicited mass advertising (i.e., “spam”), hacking of personal information, distributed denial-of-service attacks and dissemination of viruses, worms and other destructive or disruptive software, our wireless and fixed-line subscribers, in accessing the Internet through our network, may be exposed to such activities. These activities could have adverse consequences on our network and our customers, including degradation of service, excessive call volume to call centers and damage to our or our customers’ equipment and data. Significant incidents could lead to customer dissatisfaction and, ultimately, loss of customers or revenue, in addition to increased costs to us to service our customers and protect our network. Any significant loss of our subscribers or revenue due to incidents of malicious and abusive Internet practices or significant increase in costs of serving those subscribers, including in connection with the above-described cybersecurity incident, could materially and adversely affect our business, financial condition and results of operations.

Labor disputes may disrupt our operations.

Although we have never experienced any significant labor disputes, there can be no assurance that we will not experience labor disputes in the future, including protests and strikes, which could have an adverse effect on our business, financial condition and results of operations.

Every two years, the union and management negotiate and enter into a new collective bargaining agreement that has a two-year duration, which is focused on employee benefits and welfare. Employee wages are separately negotiated on an annual basis. Although we consider our relationship with our employees to be good, there can be no assurance that we will be able to maintain such a working relationship with our employees and will not experience labor disputes resulting from disagreements with the labor union in the future.

Our ability to deliver services may be disrupted due to a systems failure, shutdown in our networks or natural disaster.

Our services are currently carried through our wireless and fixed-line networks, which could be vulnerable to damage or interruptions in operations due to fires, floods, earthquakes, power losses, telecommunication failures, network software flaws, unauthorized access, computer viruses and similar events, which may occur from time to time. The occurrence of any of these events could impact our ability to deliver services, we may be liable for damages to our customers caused by such interruptions, our reputation may be damaged and our

customers may lose confidence in us, which could have a negative effect on our business, financial condition and results of operations.

Depreciation of the value of the Won against the Dollar and other major foreign currencies may have a material adverse effect on our results of operations and the market value of our common shares and ADSs.

Substantially all of our revenues are denominated in Won. Depreciation of the Won may materially affect our results of operations because, among other things, it causes:

•

an increase in the amount of Won required by us to make interest and principal payments on our foreign currency-denominated debt; and

•

an increase, in Won terms, of the costs of equipment that we purchase from overseas sources which we pay for in Dollars or other foreign currencies.

Fluctuations in the exchange rate between the Won and the Dollar will affect the Dollar equivalent of the Won price of the our common shares on the KRX KOSPI Market. These fluctuations will also affect:

•

the amounts a registered holder or beneficial owner of ADSs will receive from the American Depositary Receipt (“ADR”) depositary in respect of dividends, which will be paid in Won to the ADR depositary and converted by the ADR depositary into Dollars;

•

the Dollar value of the proceeds that a holder will receive upon sale in Korea of our common shares; and

•

the secondary market price of our ADSs.

If SK Inc. causes us to breach the foreign ownership limitations on our common shares by being deemed to be a foreign entity, we may experience a change of control.

The Telecommunications Business Act currently sets a 49.0% limit on the aggregate foreign ownership of our issued shares. Under the Telecommunications Business Act, as amended, a Korean entity, such as SK Inc., is deemed to be a foreign entity if its largest shareholder (determined by aggregating the shareholdings of such shareholder and its related parties) is a foreigner and such shareholder (together with the shareholdings of its related parties) holds 15.0% or more of the issued voting stock of the Korean entity.

Notwithstanding the above, pursuant to an amendment to the Telecommunications Business Act which became effective in April 2022, a Korean entity, so long as (i) such entity’s largest shareholder (determined by aggregating the shareholdings of such shareholder and its related parties) is a foreign entity specifically designated by the MSIT incorporated in a country that has entered into a bilateral or multilateral free trade agreement with Korea, and (ii) such shareholder (together with the shareholdings of its related parties) owns 15.0% or more of the issued voting stock of such entity, may own more than 49.0% of our issued shares but may not exercise its voting rights with respect to the shares held in excess of the 49.0% ceiling until the end of the MSIT’s Public Interest Review (see “Item 4.B. Business Overview — Foreign Ownership and Investment Restrictions and Requirements”).

As of December 31, 2025, SK Inc. owned 65,668,397 shares of our common stock, or 30.6%, of our issued shares. SK Inc. is currently not deemed to be a foreign entity. However, should SK Inc. be considered to be a foreign shareholder in the future, then its shareholding in us would be included in the calculation of our aggregate foreign shareholding and our aggregate foreign shareholding (based on our foreign ownership level as of December 31, 2025, which we believe was 36.2%) would exceed the 49.0% ceiling on foreign shareholding. As of December 31, 2025, the two largest foreign shareholders of SK Inc. each held a 3.4% stake therein.

If our aggregate foreign shareholding limit is exceeded, the MSIT may issue a corrective order to us, the breaching shareholder (including SK Inc. if the breach is caused by an increase in foreign ownership of SK Inc.) and the foreign shareholder which owns in the aggregate 15.0% or more of SK Inc. Furthermore, if SK Inc. is considered a foreign shareholder, it will be prohibited from exercising its voting rights with respect to the shares held in excess of the 49.0% ceiling, which may result in a change in control of us. In addition, the MSIT will be prohibited from granting us licenses or permits necessary for entering into new telecommunications businesses until our aggregate foreign shareholding is reduced to below 49.0%. For a description of further actions that the MSIT could take, see “Item 4.B. Business Overview — Law and Regulation — Foreign Ownership and Investment Restrictions and Requirements.”

Risks Relating to Korea

Unfavorable financial and economic developments in Korea may have an adverse effect on us.

We are incorporated in Korea, and a substantial portion of our operations and assets are located in Korea. As a result, we are subject to political, economic, legal and regulatory risks specific to Korea, and our performance and successful fulfillment of our operational strategies are dependent in large part on the overall Korean economy. In addition, the future growth of the Korean economy is subject to many factors beyond our control, including developments in the global economy. In recent years, adverse conditions and volatility in the worldwide financial markets, fluctuations in oil and commodity prices, supply chain disruptions and the increasing weakness of the global economy, which have been affected by, among others, the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia, difficulties faced by several banks in the United States and Europe, fluctuations in policy interest rates globally (including Korea), and more recently, the military conflicts between Iran and other countries, including the United States and Israel, have contributed to the uncertainty of global economic prospects in general and have adversely affected, and may continue to adversely affect, the Korean economy.

The value of the Won relative to major foreign currencies, in particular, the U.S. dollar, has fluctuated significantly and, as a result of uncertain global and Korean economic, social and political conditions, there has been significant volatility in the stock prices of Korean companies recently. Future declines in the Korea Composite Stock Price Index (the “KOSPI”), and large amounts of sales of Korean securities by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held by financial institutions in Korea, and the ability of Korean companies to raise capital. Any future deterioration of the Korean or global economy could adversely affect our business, financial condition and results of operations.

Developments that could have an adverse impact on Korea’s economy include:

•

declines in consumer confidence and a slowdown in consumer spending, including as a result of higher levels of market interest rates;

•

the imposition of significant tariffs on Korea’s exports by any of its major export markets, including the United States, as well as any countermeasures or policy responses adopted by the Government that may entail significant costs;

•

shortages of imported raw materials, natural resources, rare earth minerals or component parts, including semiconductors, due to disruptions to the global supply chain;

•

rising inflationary pressures leading to increases in costs of goods and services and a decrease in purchasing power;

•

adverse changes or volatility in foreign currency reserve levels, interest rates, inflation rates, commodity prices (including oil prices), exchange rates (including fluctuations of the U.S. dollar, the Euro or Japanese Yen exchange rates or revaluation of the Chinese Yuan) or stock markets;

•

adverse conditions or developments in the economies of countries and regions that are important export markets for Korea, such as China, the United States, Europe and Japan, or in emerging market

economies in Asia or elsewhere, including as a result of deterioration of economic and trade relations among such countries or impositions of significant tariffs by any such country and increased uncertainties in the global financial markets and industry;

•

hostilities or political or social tensions involving countries in the Middle East (such as those resulting from the military conflicts between Iran and other countries, including the United States and Israel, and internal political or social unrest within countries in the region) and Northern Africa and any material disruption in the global supply of oil or sudden increase in the price of oil;

•

the occurrence of severe health epidemics in Korea or other parts of the world;

•

interest rate fluctuations as well as perceived or actual changes in policy rates, or other monetary and fiscal policies set forth, by the U.S. Federal Reserve, Korea and other central banks;

•

a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small— and medium—sized enterprise borrowers in Korea;

•

the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements;

•

political uncertainty or increasing strife among or within political parties in Korea following the declaration of martial law by former President Yoon Suk-yeol in December 2024 that led to his impeachment and subsequent removal in April 2025 and the election of Mr. Lee Jae-myung as President in June 2025;

•

a deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial disputes or disagreements in foreign policy;

•

increased sovereign default risks in select countries and the resulting adverse effects on the global financial markets;

•

a deterioration in the financial condition or performance of small- and medium-sized enterprises and other companies in Korea;

•

investigations of large Korean business groups and their senior management for possible misconduct;

•

social and labor unrest;

•

substantial changes in the market prices of Korean real estate;

•

a substantial decrease in tax revenues and a substantial increase in the Government’s expenditures for fiscal stimulus measures, unemployment compensation and other economic and social programs, which, together, would likely lead to a national budget deficit as well as an increase in the Government’s debt;

•

financial problems or lack of progress in the restructuring of Korean business groups, other large troubled companies, their suppliers or the financial sector;

•

loss of investor confidence arising from corporate accounting irregularities or corporate governance issues concerning certain Korean companies;

•

increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea;

•

a continued decrease in the population and birthrates in Korea;

•

geopolitical uncertainty and the risk of further attacks by terrorist groups around the world;

•

hostilities or political or social tensions involving Russia (including the Russia-Ukraine war and the ensuing sanctions against Russia) and any resulting adverse effects on the global supply of oil and other natural resources or the global financial markets;

•

natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and

•

an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States.

Escalations in tensions with North Korea could have an adverse effect on us and the market value of our common shares and ADSs.

Relations between Korea and North Korea have been tense throughout Korea’s modern history. The level of tension between Korea and North Korea has fluctuated and may increase abruptly as a result of future events. In particular, there have been heightened security concerns in recent years stemming from North Korea’s nuclear weapon, ballistic missile and satellite programs as well as its hostile military actions against Korea.

North Korea renounced its obligations under the Nuclear Non-Proliferation Treaty in January 2003 and has conducted six rounds of nuclear tests since October 2006, including claimed detonations of hydrogen bombs and warheads that can be mounted on ballistic missiles. Over the years, North Korea has continued to conduct a series of missile tests, including ballistic missiles launched from submarines and intercontinental ballistic missiles that it claims can reach the United States mainland. North Korea has increased the frequency of such activities since the beginning of 2022, firing numerous ballistic missiles, including intercontinental ballistic missiles, and in November 2023, successfully launched its first spy satellite. In response, the Government has repeatedly condemned North Korea’s provocations and flagrant violations of relevant United Nations Security Council resolutions. Over the years, the United Nations Security Council has passed a series of resolutions condemning North Korea’s actions and significantly expanding the scope of sanctions applicable to North Korea as did the United States and the European Union.

North Korea’s economy also faces severe challenges, which may further aggravate social and political pressures within North Korea. Although bilateral summit meetings between Korea and North Korea were held in April, May and September 2018 and between the United States and North Korea in June 2018, February 2019 and June 2019, there can be no assurance that the level of tensions affecting the Korean peninsula will not escalate in the future. Any increase in tensions, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between Korea and North Korea or between the United States and North Korea break down or military hostilities occur, could have a material adverse effect on our business, financial condition and results of operations and the market value of our common shares and ADSs.

Korea’s legislation allowing class action suits related to securities transactions may expose us to additional litigation risk.

The Securities-related Class Action Act of Korea (the “Securities-related Class Action Act”), enacted in January 2004, allows class action suits to be brought by shareholders of companies (including us) listed on the KRX KOSPI Market for losses incurred in connection with purchases and sales of securities and other securities transactions arising from (1) false or inaccurate statements provided in the registration statements, prospectuses, annual reports, audit reports, and semi-annual or quarterly reports or omissions of material information in such documents, (2) insider trading, (3) market manipulation and (4) unfair trading. The Securities-related Class Action Act permits 50 or more shareholders who collectively hold 0.01% of the shares of a company to bring a class action suit against, among others, the issuer and its directors and officers. Because of the relatively recent enactment of the Securities-related Class Action Act, there is not enough judicial precedent to predict how the courts will apply the law. Litigation can be time-consuming and expensive to resolve, and can divert management time and attention from the operation of a business. We are not aware of any basis upon which such suit may be brought against us, nor are any such suits pending or threatened. Any such litigation brought against us could have a material adverse effect on our business, financial condition and results of operations.

There are special risks involved with investing in securities of Korean companies, including the possibility of restrictions being imposed by the Government in emergency circumstances.

As we are a Korean company and operate in a business and cultural environment that is different from that of other countries, there are risks associated with investing in our securities that are not typical for investments in securities of companies in other jurisdictions.

Under the Foreign Exchange Transactions Act of Korea, if the Government deems that certain emergency circumstances, including a significant disruption in the international balance of payments and international financial markets or extreme difficulty in carrying out currency, exchange rate or other macroeconomic policies due to the movement of capital between Korea and other countries, are likely to occur, it may impose any necessary restriction such as requiring Korean or foreign investors to obtain prior approval from the Ministry of Finance and Economy (the “MOFE”) for the acquisition of Korean securities or for the repatriation of interest, dividends or sales proceeds arising from Korean securities or from disposition of such securities or other transactions involving foreign exchange. See “Item 10.D. Exchange Controls — Korean Foreign Exchange Controls and Securities Regulations.”

Risks Relating to Securities

Sales of our shares by SK Inc. and/or other large shareholders may adversely affect the market value of our common shares and ADSs.

Sales of substantial amounts of our common shares, or the perception that such sales may occur, could adversely affect the prevailing market value of our common shares or ADSs or our ability to raise capital through an offering of our common shares.

As of December 31, 2025, SK Inc. owned 30.6% of our total issued common shares and has not agreed to any restrictions on its ability to dispose of our shares. See “Item 7.A. Major Shareholders.” We can make no prediction as to the timing or amount of any sales of our common shares. We cannot assure you that future sales of our common shares, or the availability of our common shares for future sale, will not adversely affect the prevailing market value of our common shares or ADSs from time to time.

If an investor surrenders his or her ADSs to withdraw the underlying shares, he or she may not be allowed to deposit the shares again to obtain ADSs.

Under the deposit agreement, holders of our common shares may deposit those shares with the ADR depositary’s custodian in Korea and obtain ADSs, and holders of ADSs may surrender ADSs to the ADR depositary and receive our common shares. However, under the terms of the deposit agreement, as amended, the depositary bank is required to obtain our prior consent to any such deposit if, after giving effect to such deposit, the total number of our common shares represented by ADSs exceeds a specified maximum, subject to adjustment under certain circumstances. In addition, the depositary bank or the custodian may not accept deposits of our common shares for issuance of ADSs under certain circumstances, including (1) if it has been determined by us that we should block the deposit to prevent a violation of applicable Korean laws and regulations or our articles of incorporation or (2) if a person intending to make a deposit has been identified as a holder of at least 4.0% of our common shares. It is possible that we may not give the consent. Consequently, an investor who has surrendered his or her ADSs and withdrawn the underlying shares may not be allowed to deposit the shares again to obtain ADSs.

An investor in our ADSs may not be able to exercise preemptive rights for additional new shares and may suffer dilution of his or her equity interest in us.

The Korean Commercial Code and our articles of incorporation require us, with some exceptions, to offer shareholders the right to subscribe for new shares in proportion to their existing ownership percentage whenever new shares are issued. If we offer a right to subscribe for additional new common shares or any other rights of

similar nature, the ADR depositary, after consultation with us, may make the rights available to an ADS holder or use reasonable efforts to dispose of the rights on behalf of the ADS holder and make the net proceeds available to the ADS holder. The ADR depositary, however, is not required to make available to an ADS holder any rights to purchase any additional shares unless it deems that doing so is lawful and feasible and:

•

a registration statement filed by us under the Securities Act is in effect with respect to those shares; or

•

the offering and sale of those shares is exempt from, or is not subject to, the registration requirements of the Securities Act.

We are under no obligation to file any registration statement with respect to any ADSs. If a registration statement is required for an ADS holder to exercise preemptive rights but is not filed by us, the ADS holder will not be able to exercise his or her preemptive rights for additional shares. As a result, ADS holders may suffer dilution of their equity interest in us.

Short selling of our ADSs by purchasers of securities convertible or exchangeable into our ADSs could materially adversely affect the market price of our ADSs.

SK Inc., through one or more special purpose vehicles, has engaged and may in the future engage in monetization transactions relating to its ownership interest in us. These transactions have included and may include offerings of securities that are convertible or exchangeable into our ADSs. Many investors in convertible or exchangeable securities seek to hedge their exposure in the underlying equity securities at the time of acquisition of the convertible or exchangeable securities, often through short selling of the underlying equity securities or similar transactions. Since a monetization transaction could involve debt securities linked to a significant number of our ADSs, we expect that a sufficient quantity of ADSs may not be immediately available for borrowing in the market to facilitate settlement of the likely volume of short selling activity that would accompany the commencement of a monetization transaction. This short selling and similar hedging activity could place significant downward pressure on the market price of our ADSs, thereby having a material adverse effect on the market value of ADSs owned by you.

A holder of our ADSs may not be able to enforce a judgment of a foreign court against us.

We are a corporation with limited liability organized under the laws of Korea. Substantially all of our directors and officers and other persons named in this annual report reside in Korea, and all or a significant portion of the assets of our directors and officers and other persons named in this annual report and substantially all of our assets are located in Korea. As a result, it may not be possible for holders of our ADSs to effect service of process within the United States, or to enforce against us any judgments obtained from the United States courts based on the civil liability provisions of the federal securities laws of the United States. There is doubt as to the enforceability in Korea, either in original actions or in actions for enforcement of judgments of United States courts, of civil liabilities predicated on the United States federal securities laws.

We are generally subject to Korean corporate governance and disclosure standards, which may differ from those in other countries.

Companies in Korea, including us, are subject to corporate governance standards applicable to Korean public companies, which may differ in some respects from standards applicable in other countries, including the United States. As a reporting company registered with the SEC and listed on the New York Stock Exchange (“NYSE”), we are subject to certain corporate governance standards as mandated by the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). However, foreign private issuers, including us, are exempt from certain corporate governance requirements under the Sarbanes-Oxley Act or under the rules of the NYSE. There may also be less publicly available information about Korean companies, such as us, than is regularly made available by public or non-public companies in other countries. Such differences in corporate governance standards and less public information available could result in corporate governance practices or disclosures that are perceived as less than satisfactory by investors in certain countries.

Item 4.

INFORMATION ON THE COMPANY

Item 4.A.

History and Development of the Company

As Korea’s first wireless telecommunications service provider, we have a recognized history of leadership and innovation in the domestic telecommunications sector. Today, we remain Korea’s leading wireless telecommunications services provider and have continued to pioneer the commercial development and implementation of state-of-the-art wireless technologies. We had 23.5 million mobile phone subscribers, including MVNO subscribers leasing our networks, as of December 31, 2025, representing a market share of 41.6%, the largest market share among Korean wireless telecommunications service providers. We believe that we are also a leader in developing new products and services that reflect the increasing convergence of telecommunications technologies, as well as the growing synergies between the telecommunications sector and other industries.

In February 2012, we acquired an equity stake in SK Hynix, one of the world’s largest memory-chip makers by revenue, for an aggregate purchase price of Won 3.4 trillion, and became its largest shareholder. In November 2021, we transferred all of our 20.1% equity interest in SK Hynix to SK Square pursuant to the Spin-off, as further described below.

Effective as of November 1, 2021, we conducted the Spin-off, pursuant to which we spun off our equity interests in certain subsidiaries and investees (collectively comprising the Spin-off Portfolio Companies) engaged in the semiconductor and certain other non-telecommunications businesses, including our security, e-commerce and other new ICT businesses (collectively comprising the Spin-off Businesses) to SK Square, a newly established holding company, and we distributed SK Square’s shares of common stock on a pro rata basis to the holders of our common stock.

In connection with the Spin-off, we also engaged in a 5-to-1 stock split of our common stock (the “Stock Split”), pursuant to which the par value of our common stock changed from Won 500 per share to Won 100 per share and the number of issued shares of our common stock increased from 72,060,143 shares to 360,300,715 shares, in each case effective as of October 28, 2021. Immediately following, and as a result of, the Stock Split, each ADS outstanding as of October 28, 2021 represented five-ninths of one share of our common stock. On March 31, 2026, we had a market capitalization of approximately Won 16.4 trillion (US$10.7 billion) or approximately 0.4% of the total market capitalization on the KRX KOSPI Market, making us the 48th largest company listed on the KRX KOSPI Market based on market capitalization on that date. Our ADSs, each representing five-ninths of one share of our common stock, have traded on the NYSE since June 27, 1996.

We are a corporation with limited liability organized under the laws of Korea. We established our telecommunications business in March 1984 under the name Korea Mobile Telecommunications Co., Ltd. We changed our name to SK Telecom Co., Ltd., effective March 21, 1997. In January 2002, we merged with Shinsegi Telecom Co., Ltd. (“Shinsegi”), which was then the third-largest wireless telecommunications service provider in Korea. Our registered office is at SK T-Tower, 65, Eulji-ro, Jung-gu, Seoul 04539, Korea and our telephone number is +82-2-6100-1532. Our website address is www.sktelecom.com.

The SEC maintains a website (www.sec.gov), which contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

Korean Telecommunications Industry

Established in March 1984, we became the first wireless telecommunications service provider in Korea. We remained the sole provider of wireless telecommunications services until April 1996, when Shinsegi commenced cellular service. The Government began to introduce competition into the fixed-line and wireless telecommunications services markets in the early 1990’s. During this period, the Government allowed new competitors to enter the fixed-line sector, sold a controlling stake in us to the SK Group, and granted a cellular

license to our first competitor, Shinsegi. In October 1997, three additional companies began providing wireless telecommunications services under Government licenses to provide wireless telecommunications services. In 2000 and 2001, the Korean wireless telecommunications market experienced significant consolidation. In January 2002, Shinsegi was merged into us. Additionally, two of the other wireless telecommunications services providers merged.

There are currently three mobile network operators in Korea: us, KT and LG U+. As of December 31, 2025, the market share of the Korean wireless telecommunications market, in terms of number of mobile phone subscribers, of KT and LG U+ was approximately 30.8% and 27.6%, respectively (compared to our market share of 41.6%), each including MVNO subscribers leasing the respective networks. As of December 31, 2025, MVNOs had a combined market share of 18.3%, of which MVNOs leasing our networks represented 3.1%, MVNOs leasing KT’s networks represented 7.0% and MVNOs leasing LG U+’s networks represented 8.1%. In January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X to provide nationwide wireless network services. However, in July 2024, the Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application.

Telecommunications industry growth in Korea has been among the most rapid in the world, with fixed-line penetration being under five lines per 100 population in 1978 and increasing to 47.9 lines per 100 population as of December 31, 2006 before decreasing to 19.0 lines per 100 population as of December 31, 2025, and mobile phone penetration reaching 110.6 subscribers per 100 population as of December 31, 2025. The table below sets forth certain subscription and penetration information regarding the Korean telecommunications industry as of the dates indicated:


	As of December 31,
	2025			2024			2023
	(In thousands, except for per population amounts)
Population of Korea⁽¹⁾		51,117			51,217			51,325
Mobile Phone Subscribers		56,531	⁽²⁾		56,185	⁽²⁾		56,164
Mobile Phone Subscribers per 100 Population		110.6			109.7			109.4
Telephone Lines in Service		9,692			10,325			10,974
Telephone Lines per 100 Population		19.0			20.2			21.4

(1)	Source: The Ministry of the Interior and Safety.

(2)

Excludes internal carrier lines and inbound roaming lines pursuant to a change in the presentation of the MSIT’s published data in 2024. As of December 31, 2024 and December 31, 2025, an aggregate of 693 thousand and 927 thousand internal carrier lines and inbound roaming lines, respectively, were in existence.

Since the introduction of short text messaging in 1998, Korea’s wireless data market has grown rapidly. This growth has been driven, in part, by the rapid development of wireless Internet service since its introduction in 1999 and the implementation of LTE and 5G technologies providing for fast data transmission speeds and large data transmission capacity. The table below sets forth certain penetration information regarding the number of smartphones that have direct access to the Internet using mobile Internet technology and mobile phone subscribers in Korea as of the dates indicated:


	As of December 31,
	2025			2024			2023
	(In thousands, except for percentage data)
Number of Smartphones		56,875			56,112			55,126
Total Number of Mobile Phone Subscribers		56,531	⁽¹⁾		56,185	⁽¹⁾		56,164
Penetration of Smartphones		100.6	%		99.9	%		98.2	%

(1)

In addition to its well-developed wireless telecommunications sector, Korea has one of the largest Internet markets in the Asia Pacific region. From the end of 2010 to the end of 2025, the number of broadband Internet access subscribers increased from approximately 17.2 million to approximately 25.2 million. In connection with such growth in broadband Internet usage, the number of IPTV subscribers has also increased rapidly. The table below sets forth certain information regarding broadband Internet access subscribers and IPTV subscribers as of the dates indicated:


	As of December 31,
	2025		2024		2023
	(In thousands)
Number of Broadband Internet Access Subscribers⁽¹⁾		25,234		24,722		24,098
Number of IPTV Subscribers		21,994		21,828		21,582

(1)	Includes subscribers accessing Internet service using digital subscriber line, or xDSL, connections; cable modem connections; local area network, or LAN, connections; fiber-to-the-home, or FTTH, connections and satellite connections.

Item 4.B.

Business Overview

Overview

We are Korea’s leading wireless telecommunications services provider, and our core business is centered on providing wireless and fixed-line telecommunications services. We maintain the largest market share in the Korean market for wireless telecommunications services. Our revenue is primarily generated from our cellular services segment, which accounts for a substantial portion of our consolidated revenue, with additional contributions from our fixed-line telecommunications services and other business segments. We continue to develop, enhance and operate our telecommunications services through ongoing investments in network infrastructure and the adoption of advanced technologies, with a focus on improving service quality, reliability and operational efficiency. In addition to our core telecommunications services, we offer a broad range of complementary services and solutions that leverage our telecommunications platforms and digital infrastructure capabilities. These include IoT solutions and enterprise communications services, cloud services, subscription services, advertising and curated shopping services, AI business-to-consumer (“B2C”) services and AI business-to-business (“B2B”) services. We seek to drive growth by enhancing our core telecommunications services while selectively expanding complementary services that leverage our network infrastructure and customer base. These services are designed to enhance customer engagement, expand our service offerings and support the overall competitiveness of our core telecommunications business. Our operations are reported in three segments:

•

cellular services, which include wireless voice and data transmission services, sales of wireless devices, cellular interconnection services, as well as IoT solutions and enterprise communications services, cloud services, subscription services, advertising and curated shopping services, AI B2C services and AI B2B services;

•

fixed-line telecommunications services, which include fixed-line telephone services, broadband Internet services, advanced media platform services (including IPTV and cable TV services), and business communications and related infrastructure services; and

•

other businesses, which include our T-commerce business and certain other miscellaneous businesses.

Our Business Strategy

We operate in an environment characterized by rapid technological advancements, evolving customer needs and increasing convergence across industries. In response to these trends, we focus on strengthening our core telecommunications business and enhancing customer trust and value, while selectively expanding our AI-related capabilities to support our long-term growth. Our strategy is centered on maintaining our leadership in the Korean market for wireless telecommunications services, improving service quality and operational efficiency, and pursuing disciplined growth opportunities in selected areas, including AI-related initiatives that complement our existing business. In doing so, we seek to leverage our core telecommunications infrastructure and subscriber base to support the expansion of complementary services and improve operational efficiency. Our principal business strategies are as follows:

•

Strengthening our core telecommunications business. We seek to maintain our leadership in the Korean market for wireless telecommunications services by enhancing network quality, expanding service offerings and improving customer experience. We are focused on optimizing our network operations and improving service reliability, including through the adoption of advanced technologies such as AI-based network management and automation. We also continue to leverage data analytics to better understand customer needs and to provide more relevant and personalized products and services.

•

Enhancing customer trust and service stability. We place significant emphasis on strengthening customer trust and delivering stable and reliable services. Following recent cybersecurity incidents that have affected the telecommunications industry, we have taken steps to enhance our security systems and internal control processes, including upgrades to our security infrastructure and improvements in asset management and monitoring capabilities. We plan to continue to invest in technologies and processes designed to enhance the security, reliability and resilience of our services, and to reinforce our ability to respond to evolving risks, with the aim of maintaining and improving customer trust.

•

Selectively expanding AI-related capabilities. We are pursuing a disciplined and selective approach to the development of our AI-related capabilities by focusing on areas where we can enhance our existing services, improve operational efficiency or develop solutions with clear commercial applications. We are investing in selected AI infrastructure and computing capabilities, as well as AI-based solutions that can be integrated into our telecommunications services or offered to enterprise customers. We aim to leverage our existing assets, including our network infrastructure and customer base, to support the development of these capabilities.

•

Improving operational efficiency and pursuing sustainable growth. We are focused on improving operational efficiency across our business and optimizing our cost structure, including through automation and data-driven decision-making. In addition, we continue to pursue long-term sustainable growth by enhancing the efficiency of our operations, including our network infrastructure, and by supporting the responsible use of technology. Through these efforts, we aim to create long-term value for our shareholders and other stakeholders.

In line with our business strategies as discussed above, we are striving to enhance our operational efficiency through our efforts to reduce operating expenses, optimize capital expenditures and reorganize non-essential business lines and investments. For example, in order to streamline our operating expenses, we have been actively utilizing AI technology in various operational processes, including our marketing activities and customer services. Furthermore, we have shifted the focus of our 5G network-related capital expenditure from expanding network coverage and increasing maximum data transmission speed to enhancing network quality. Moreover, in December 2024, we entered into agreements with Samgu Inc. and its affiliates to dispose of a 70% equity interest in SK M&Service, as well as our 100% equity interest in our former wholly-owned subsidiary NATE Communications Corporation, which operates the “Nate” internet portal, and the entirety of our 50% equity interest in our former associate F&U Credit Information, which provides credit information services. The disposals of NATE Communications Corporation, SK M&Service and F&U Credit Information were completed in January 2025, February 2025 and April 2025, respectively. In April 2025, we disposed of 10,818,510 shares of

Kakao Corp. (representing a 2.4% interest), which we had previously acquired in 2019 as part of a strategic partnership between the two companies, for Won 413.3 billion. More recently, in December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa, which operates our T-commerce business, and Media S, which operates two TV channels and co-produces original television entertainment contents, to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions.

Cellular Services

We offer wireless voice and data transmission services, sell wireless devices and provide various other technological solutions and services through our cellular services segment. Our wireless voice and data transmission services are offered through our backbone networks that collectively can be accessed by substantially all of the Korean population. We had 23.5 million mobile phone subscribers, including MVNO subscribers leasing our networks, as of December 31, 2025, representing a market share of 41.6%, the largest market share among Korean wireless telecommunications service providers. We launched our wireless services using our 5G network in April 2019, and we are continually maintaining and enhancing our 5G network coverage and service quality. The table below sets forth the number of mobile phone subscribers, including subscribers of MVNOs that lease our wireless networks, using our various digital wireless networks as of the dates indicated:


	As of December 31,
	2025⁽¹⁾		2024⁽¹⁾		2023⁽¹⁾
	(in thousands)
Network
5G		17,653		17,052		15,588
LTE		6,201		7,536		8,730
WCDMA		201		325		415

Total		24,055		24,913		24,733

(1)	Includes internal carrier lines and inbound roaming lines.

In 2025, 2024 and 2023, our cellular services segment revenue was Won 12,552.5 billion, Won 13,318.2 billion and Won 13,123.2 billion, respectively, representing 73.4%, 74.2% and 74.5%, respectively, of our consolidated revenue.

Wireless Services

We offer wireless voice transmission and data transmission services to our subscribers through our backbone networks. Our wireless telecommunications services are available to our subscribers receiving service under the SK Telecom brand. In addition, customers can obtain wireless telecommunications services that operate on our network from MVNOs that lease our wireless networks. We derive revenues from our wireless telecommunications service principally through monthly plan-based fees as described in “— Rate Plans” below.

We provide a voice-over-LTE service, known as our “HD Voice” service, to all of our LTE and 5G subscribers featuring high-quality voice transmission, fast call connection, voice-to-video call switching and digital content sharing during calls. We also offer our subscribers a wide range of wireless data transmissions services. Our messaging service allows our subscribers to send and receive text, graphic, audio and video messages. In addition, our subscribers can access a wide variety of digital content and services through mobile applications providing music, video, gaming, news, commerce and financial services as well as solutions that enable subscribers to access the Internet and e-mail. We intend to continue to build our wireless data services as a platform for growth, extending our portfolio of wireless data services and developing new content for our subscribers.

Through service agreements with various foreign wireless telecommunications service providers, we offer cellular global roaming services, branded as our “T-Roaming” service. Global roaming services allow subscribers traveling abroad to make and receive calls using their regular mobile phone numbers. In addition, we provide global roaming service to foreigners traveling to Korea. In such cases, we generally receive a fee from the traveler’s local wireless telecommunications service provider.

Through our subsidiary SK Telink Co., Ltd. (“SK Telink”), we also operate our MVNO business under the brand “SK 7Mobile,” which we believe offers excellent quality at reasonable rates utilizing SK Telecom’s wireless networks. SK Telink is focused on developing low-cost distribution channels and targeting niche customer segments that have a lower average revenue per user than that of SK Telecom’s subscriber base.

In addition, we provide interconnection service to connect our networks to domestic and international fixed-line and other wireless networks. See “— Interconnection” below.

Wireless Device Sales

We offer several categories of wireless devices, including smartphones and basic phones, tablets and other Internet access devices and wearable devices that are sold through an extensive distribution network, which consists of authorized exclusive dealers and independent retailers, as well as branch offices and stores directly operated by us through our wholly-owned subsidiary, PS&Marketing. As of December 31, 2025, substantially all of our mobile phone subscribers (including MVNO subscribers leasing our networks) owned smartphones that have direct access to the Internet. We purchase a substantial majority of our wireless devices from Samsung Electronics and Apple.

Smartphones and Basic Phones. We offer smartphones that are enabled to utilize our digital wireless networks and run on various operating systems, such as Apple iOS and Google Android. We also offer basic phones that have the ability to access wireless Internet services.

Tablets and Wearable Devices. We offer tablets and wearable devices, primarily comprising smart watches, which can access the Internet via our digital wireless networks and a Wi-Fi connection. The tablets and wearable devices run primarily on the Apple iOS and Google Android operating systems, and we provide targeted rate plans that are specific to such devices. See “— Rate Plans” below.

Other Solutions and Services

In addition to our cellular services and wireless device sales businesses, we provide a variety of other innovative technological solutions and services by leveraging our capabilities in telecommunications, AI and ICT technologies, and we are continuing to invest in these and other emerging new business areas, including the following:

IoT Solutions and Enterprise Communication Services

Through our IoT solutions business, we provide network access and enhanced services to support telemetry-type applications, which are characterized by massive machine-type communication (“mMTC”) wireless connections, to our enterprise customers. In order to promote the growth of our IoT solutions business, we deployed networks nationwide that are designed to support IoT devices, namely our high-speed LTE-M network in March 2016 and our low-cost Low-Power Wide-Area network based on LoRa technology (our “LoRa network”) in July 2016. In April 2018, we increased the battery efficiency of our IoT devices by launching our LTE Cat.M1 technology, and we have further enhanced our competitiveness in this business with our 5G network.

We provide network access and customized IoT solutions to our enterprise customers. Our IoT services support devices that are used in a variety of market segments, including manufacturing, logistics, public

infrastructure, security, automotive, agriculture and data analytics as well as public institutions. For example, we provide services to transmit and store extensive data accumulated in manufacturing processes of our customers through our ultra-high speed and ultra-low latency connectivity solutions. We also offer private wireless and fixed-line networks for businesses as well as digital transformation infrastructure leveraging our 5G and edge cloud technologies.

We also provide a variety of other communication solutions and services to our enterprise customers. Our key offerings in this area include IoT, security, advertising and monitoring solutions, business messaging and call services, and platforms for mobile payment, authentication and ancillary value-added services.

Cloud Services

We provide a comprehensive range of managed cloud services that focus on supporting cloud-based AI services in Korea. Our managed cloud services are provided in collaboration with our SK Group affiliate SK AX, which engages in B2B sales and the establishment and operation of the services, while we provide the necessary AI infrastructure and solutions. Our managed cloud services benefit from our leadership in network infrastructure in Korea and our competitive capabilities in AI, big data, data centers and information security. We plan to further strengthen our market position by developing and providing tailored AI cloud services that meet the needs of our enterprise customers.

Subscription Service

In August 2021, we launched a subscription-based membership service under our “T Universe” brand name. T Universe offers a wide range of lifestyle services through subscription packages. From streaming services such as YouTube Premium, Netflix and Wavve to shopping, cloud storage services such as Google One, and various partner restaurants and delivery services, customers can subscribe to a broad selection of services either as bundled packages or as standalone offerings. To enhance its service offerings, T Universe continues to pursue business partnerships with popular consumer brands and service providers, expanding the scope of its partnerships. We also plan to grow and further develop T Universe by identifying and marketing new products and services that align with customer preferences.

Advertising and Curated Shopping Services

We offer advertising services to businesses by leveraging our wireless and fixed-line telecommunications services platforms. Our advertising services primarily consist of display advertising on our proprietary mobile applications for smartphones, including “A. (or “A dot”) Phone” and “T Membership” (which manages our customer loyalty program under the same name). In addition, we offer a text message-based curated shopping service under our “T Deal” brand. Our customers who have consented to the T Deal service receive a daily text message on their smartphones with a link to a broad range of merchandise with significant discounts that are specially curated to maximize customer interest by utilizing AI technology and big data.

AI B2C Services

Through our AI B2C services business, we seek to provide innovative AI-based mobile agent services that meet our customers’ evolving needs in an increasingly connected world. In September 2023, we officially launched A., which offers the ability to verbally communicate with the user and handle a variety of tasks on the user’s smartphone, including recording and summarizing calls, managing the user’s schedules, providing real-time interpretation service during calls and recommending and playing personalized music and video contents. In August 2024, A. underwent a major update, allowing it to deliver a natural conversational experience and specialized services through various agents with enhanced search and everyday convenience features. In October 2024, we rebranded our proprietary voice call application, “T Phone,” as “A. Phone,” embedded certain of A.’s AI-enhanced service features, including the ability to record, summarize and translate calls, into the A. Phone

application. In June 2025, we introduced two additional features to A., including “A. Note,” which offers real time voice transcription and summarization services, and “A. Briefing,” which utilizes users’ personalized data to proactively provide personalized suggestions and helpful information for the users’ daily routines and tasks. We plan to continually strengthen the levels of personalization and information security, and expand the portfolio of services handled, by A., including through combination with our other service offerings as well as collaboration with our SK Group affiliates and third parties.

AI B2B Services

Our business customers have been increasingly seeking digital transformation by implementing AI technology, including generative AI, into their operations and business cycle. In order to meet such needs of our business customers, we have introduced various AI technology services, which we have been developing in order to improve our and our affiliated companies’ competitiveness, which are collectively referred to as “AI B2B” services (formerly referred to as “enterprise AI” services). Our AI B2B services combine AI technology with connectivity and infrastructure technologies of our core telecommunications business as well as the underlying technologies of our other new growth businesses, and principally include generative AI, AI vision, AI contact center, AI marketing, AI data and physical AI. In 2025, we also preliminarily launched “A. Biz,” a B2B version of our “A.”, an AI agent service featuring general administrative functions as well as the ability to provide assistance in a number of areas requiring professional expertise, including legal, tax, public relations, purchasing and personnel management, to business organizations. Following a period of beta tests, A. Biz is currently utilized internally as well as by a number of our SK Group affiliates.

Other New Business Services

We are also investing in and developing new business areas that actively integrate AI technology, including through strategic investments in, and collaboration with, leading domestic and overseas technology companies. We have also been makings investments to develop and launch GPU-as-a-service (“GPUaaS”), which would enable our enterprise customers to access GPU cloud services on an as-needed basis to develop or utilize AI services. As part of such initiative, in February 2024, we made an equity investment of US$20 million in Lambda, Inc., a GPU cloud service provider based in San Francisco, to cooperate on the development and launch of GPUaaS and AI data center solutions and services. In August 2024, we entered into a strategic partnership with Lambda, Inc. to deploy its AI cloud platform in SK Broadband’s Gasan data center, and launched our GPUaaS in January 2025. In August 2025, we launched the “Haein cluster,” comprised of more than 1,000 NVIDIA Corporation’s B200 GPUs, in SK Broadband’s Gasan data center. The Haein cluster has been selected by the MSIT for the Government’s “Sovereign AI Foundation Model Project,” which is aimed at building domestic AI foundation models with globally competitive performance, thereby reducing Korea’s reliance on foreign AI technologies. A consortium led by us has advanced to the second stage of the Sovereign AI Foundation Model Project. In June 2025, we announced the partnership with Amazon Web Services, Inc. to build an AI data center in Ulsan, Korea, with operations expected to begin in 2027. We commenced construction of such data center in September 2025. In October 2025, we signed a letter of intent and a memorandum of understanding with OpenAI, an AI research organization based in San Francisco, California, to collaborate on the construction of an AI data center in the southwest region of Korea as part of OpenAI’s Stargate project, which aims to establish a global AI infrastructure. Furthermore, we have been engaged in the research, development and promotion of AI data center solutions. As part of such initiative, in December 2024, we made an equity investment of US$200 million in Penguin Solutions Inc. (formerly known as Smart Global Holdings, Inc.), a leading designer and developer of enterprise solutions based in Milpitas, California, in order to cooperate on the development of differentiated global end-to-end AI factory and data center solutions and services.

Rate Plans

We offer our wireless telecommunications services on both a postpaid and prepaid basis. Substantially all of our subscribers received our wireless telecommunications services on a postpaid basis as of December 31, 2025.

Postpaid accounts primarily represent retail subscribers under contract with SK Telecom pursuant to which a subscriber is billed in advance a monthly fixed service fee in return for a monthly network service allowance and usage for outgoing voice calls and wireless data services beyond the allowance is billed in arrears, where payment of the total amount of the bill is due at the end of the month. The standard contract period for our rate plans is 24 months, although our subscribers have the option to enter into shorter term contracts or no fixed-term contract at all. We provide various subsidies and discounts, including handset subsidies, depending on the length of the contract and the subscriber’s chosen rate plan. Our prepaid service enables individuals to obtain wireless telecommunications services without a fixed-term contract by paying for all services in advance according to expected usage. We do not charge our customers for incoming calls, although we do receive interconnection charges from KT and other companies for calls from the fixed-line network terminating on our networks and interconnection revenues from other wireless network operators. See “— Interconnection” below.

We also charge our customers a 10.0% value-added tax, which is included in the price of all of our rate plans. We can offset the value-added tax we collect from our customers against value-added tax refundable to us by the Korean tax authorities. We remit taxes we collect from our customers to the Korean tax authorities. We record revenues in our financial statements net of such taxes.

Basic Rate Plans. We offer various postpaid account plans for mobile devices, tablets and smart watches that are designed to meet a wide range of subscriber needs and interests. Our 5G services are primarily provided through the “5GX” plans, which offer unlimited domestic voice minutes and text messaging and unlimited data transmission allowance per month and range from Won 69,000 to Won 125,000 per month. We also offer several types of lower-priced 5G rate plans, ranging from Won 39,000 to Won 59,000 per month, with smaller data transmission allowances per month compared to our 5GX plans that target subscribers who seek more affordable rate plans. Our representative smartphone rate plans for our LTE services are the “T” plans, which feature unlimited domestic voice minutes and text messaging and a fixed or unlimited data transmission allowance per month and range from Won 33,000 to Won 100,000 per month. We also offer “Direct” plans that are exclusively available through our online distribution channel, ranging from Won 27,000 to Won 76,000 per month for 5G services and at Won 22,000 per month for LTE services. Our “Voice Free” plans are available for our basic phones and feature a fixed allowance of voice minutes and 50 text messages per month with rates that range from Won 20,900 to Won 103,400 per month. We also offer a standard rate plan for Won 12,100 per month, through which the subscriber is charged per usage amount, other than on text message usage up to 50 messages per month. In October 2025, we launched six types of “air” subscription plans, a separate line of mobile subscription services offered exclusively for unlocked mobile devices through a dedicated online channel.

In addition, we provide a variety of differentiated rate plans for our customer segments such as our “0 Youth” plans for smartphone users who are 34 years old or younger tailored for younger demographics, our “0 Teen” plans for teenagers who are 18 years old or younger, our “ZEM” plans for children who are 12 years old or younger, our “T Senior” LTE and 5G subscription plans for users who are 65 years or older, our “5G Happiness (Haengbok-nuri)” plans for customers with visual impairment or hearing loss and our “0 Hero” LTE plans for users who are performing mandatory military service.

We also offer bundled rate discount plans combining multiple wireless devices as well as those combining our wireless services with our fixed-line telecommunications services. In addition, we offer bundled rate plans that provide discounts for family members or co-inhabitants of the same household.

Data Add-on Rate Plans. We offer a variety of optional “add-on” rate plans and data coupons that are designed to meet a wide range of subscriber needs with respect to increased data usage that followed the widespread use of smartphones and faster transmission speeds. For example, for certain rate plan subscribers, we offer unlimited access to the wavve video streaming service and the Flo music streaming service through our “wavve and Data Plus” plan and “Flo and Data Plus” plan, respectively, at no additional cost, at a discounted rate or at the standard rate, depending on the subscribers’ basic rate plan.

Roaming Plans. Our representative international roaming plan for longer term travelers and provides fixed data transmission, named “baro Plan,” offers allowances of 3GB for Won 29,000, 6GB for Won 39,000, 12GB for Won 59,000 or 24GB for Won 79,000 that can be used in 195 countries. We also offer data sharing options to families travelling together and special discounts to subscribers of our “0 Youth” plans. In addition, all of our roaming plans include free high-quality data voice calls and text messages to Korea through our A. Phone application.

Digital Wireless Network

We offer wireless voice and data transmission services throughout Korea using digital wireless networks, primarily consisting of our 5G network, LTE network, WCDMA network, Wi-Fi network and LoRa network. We continually upgrade and increase the capacity of our wireless networks to keep pace with advancements in technology, the growth of our subscriber base and the increased usage of voice and wireless data services by our subscribers. For more information about our capital expenditures relating to our wireless networks, see “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures.”

5G Network. 5G is the currently dominant wireless network that enables data to be transmitted at speeds faster than our LTE network with lower latency. We began the operation of our 5G network in December 2018 on a limited basis for business customers, beginning with a few major commercial districts in Seoul and other metropolitan areas. We launched wireless service plans using the 5G network in April 2019 following the commencement of sales of the first 5G-compatible smartphones, and we continue to maintain and enhance our 5G network coverage. We currently provide full nationwide 5G network coverage across outdoor terrestrial areas and subway lines, and substantially full nationwide 5G network coverage in large buildings. Our 5G services provided a maximum data transmission speed of 2.75 Gbps. We have also deployed our 5G network for mMTC connections relating to our IoT solutions.

We believe that our 5G technology and network infrastructure enable us to provide the fastest 5G data transmission network nationwide. In December 2025, the MSIT announced that our 5G network provided the fastest upload and download speeds among the three mobile network operators, KT, LG U+ and us. The nationwide average download speed of our 5G network was 1,214 Mbps compared to 1,147 Mbps for KT’s 5G network and 1,051 Mbps for LG U+’s 5G network.

LTE Network. LTE technology has become widely accepted globally as the standard fourth generation technology and enables data to be transmitted at speeds faster than our WCDMA network. Since first commencing our LTE services in July 2011, we have developed and launched various upgraded LTE networks and related services providing faster network speeds, enhanced connectivity and broader coverage areas.

We believe that our advanced LTE technology and dense network infrastructure enable us to provide the fastest LTE data transmission network nationwide. In December 2025, the MSIT announced that our LTE network provided the fastest upload and download speeds among the three mobile network operators, KT, LG U+ and us. The nationwide average download speed of our LTE network was 216 Mbps compared to 161 Mbps for KT’s LTE network and 141 Mbps for LG U+’s LTE network.

Wi-Fi Network. Wi-Fi technology enables our subscribers with Wi-Fi-capable devices such as smartphones, laptops and tablet computers to access mobile Internet. We started to build Wi-Fi access points in 2010 and, as of December 31, 2025, we had more than 60,000 Wi-Fi access points in public areas such as shopping malls, restaurants, coffee shops, subways and airports where, generally, the demand for high-speed wireless Internet service is high. While each Wi-Fi access point typically has a radius of approximately 20-30 meters, some of our Wi-Fi hot zones, which have multiple Wi-Fi access points, including those installed at public transportation facilities and amusement parks, have much wider service areas.

LoRa Networks. A Low-Power Wide-Area network based on LoRa technology is a type of telecommunications network designed to support communication among IoT devices. It can transmit data over

tens of kilometers while consuming much less power than LTE networks, lowering costs for connectivity as well as lowering battery power usage. We completed the nationwide deployment of our LoRa network in July 2016. We expect that our LoRa network will provide the infrastructure necessary for the growth of not only our own IoT solutions business but also the IoT industry as a whole.

Network Infrastructure

The principal components of our wireless networks are:

•

base stations, which are physical locations equipped with transmitters, receivers and other equipment that communicate by radio signals with wireless handsets within range of the cell (typically a 3 to 40 kilometer radius);

•

switching stations, which switch voice and data transmissions to their proper destinations, which may be, for instance, a mobile phone of one of our subscribers (for which transmissions would originate and terminate on our wireless networks), a mobile phone of a KT or LG U+ subscriber (for which transmissions would be routed to KT’s or LG U+’s wireless networks, as applicable), a fixed-line telephone number (for which calls would be routed to the public switched telephone network of a fixed-line network operator), an international number (for which calls would be routed to the network of a long distance service provider) or an Internet site; and

•

transmission lines, which link base stations to switching stations and switching stations with other switching stations.

As of December 31, 2025, our 5G, LTE and WCDMA networks had an aggregate of 58,567 base stations.

To date, we have purchased substantially all of the equipment for our networks from Samsung Electronics, Ericsson-LG and Nokia. Most of the transmission lines we use, including virtually all of the lines linking switching stations, as well as a portion of the lines linking base stations to switching stations, comprise optical fiber lines that we own and operate directly. However, we have not undertaken to install optical fiber lines to link every base station and switching station. In places where we have not installed our own transmission lines, we have leased lines from KT and LG U+. We intend to increase the efficiency of our network utilization and provide optimal services by internalizing transmission lines.

We use a wireless network surveillance system. This system oversees the operation of base stations and allows us to monitor our main equipment located throughout the country from one monitoring station. The automatic inspection and testing provided to the base stations lets the system immediately rebalance to the most suitable setting, and the surveillance system provides for automatic dispatch of repair teams and quick recovery in emergency situations.

Marketing, Distribution and Customer Service

Marketing. Our marketing strategy is focused on offering solutions tailored to the needs of our various customer segments, promoting our brand and leveraging our extensive distribution network. Our marketing plan includes a coordinated program of television, print, radio, outdoor signage, Internet and point-of-sale media promotions designed to relay a consistent message across all of our markets. We market our wireless products and services under the “T” brand, which signifies the centrality of “Telecommunications” and “Technology” to our business and also seeks to emphasize our commitment to providing “Top” quality, “Trustworthy” products and services to our customers.

We have implemented certain information technology improvements in connection with our marketing strategy, including customer management systems, as well as more effective information security controls. We believe these upgrades have enhanced our ability to process and utilize marketing- and subscriber-related data,

which, in turn, has helped us to develop more effective and targeted marketing strategies. We currently operate a customer information system designed to provide us with an extensive customer database. Our customer information system includes a billing system that provides us with comprehensive account information for internal purposes and enables us to efficiently respond to customer requests. Our customers can also change their rate plans, verify the charges accrued on their accounts, receive their bills online and send text messages to our other subscribers through our website at www.tworld.co.kr and through our “T world” mobile application.

We strive to improve subscriber retention through our T Membership program, which is a membership service available to our wireless subscribers. Our T Membership program provides various membership benefits to its members such as discounts with our membership partners for dining, shopping, entertainment and travel, membership points accumulation, access to our online membership shopping mall and invitations to various promotional events. Although our competitors also have similar membership programs, we believe that our T Membership program has a competitive advantage over our competitors’ membership programs due to our large subscriber base and breadth of membership benefits.

Distribution. We use a combination of an extensive network, including branch offices and stores, directly operated by us through our subsidiary, PS&Marketing, more than 2,500 authorized exclusive dealers and an extensive network of independent retailers in order to increase subscriber growth while reducing subscriber acquisition costs.

In addition, we operate an online distribution channel, “T Direct Shop,” through which subscribers can conveniently purchase wireless devices and subscribe to our services online. We also operate a dedicated online shop on 11st, our former subsidiary Eleven Street’s e-commerce marketplace. In light of increasing customer preference for online service, the level of distribution of our wireless devices and our services through online channels has significantly increased in recent years. We intend to continue to develop our online distribution channel to leverage our offline distribution capabilities to provide convenience and additional value to our subscribers. For example, subscribers purchasing wireless devices through T Direct Shop can opt to pick up their devices at one of our offline stores.

Currently, authorized dealers are entitled to an initial commission for each new subscriber registered by the dealer, as well as an average ongoing commission calculated as a percentage of that subscriber’s monthly plan-based rate for the first five years. In order to strengthen our relationships with our exclusive dealers, we offer a dealer financing plan, pursuant to which we provide to each authorized dealer a loan of up to Won 4.0 billion (Won 5.0 billion if collateral is pledged) which can be used for operating expenditures with a repayment period of up to 11 months. We also provide loans to our authorized dealers for financing deposits and key money in connection with securing retail space with a repayment period of up to 30 months. As of December 31, 2025, we had an aggregate of Won 61.1 billion outstanding in loans to authorized dealers.

Customer Service. We provide high-quality customer service directly through our two subsidiaries, Service Ace Co., Ltd. and Service Top Co., Ltd., rather than rely on outsourcing. SK O&S Co., Ltd. operates our switching stations and related transmission and power facilities and offers quality customer service primarily to our business customers. We have held the top position with respect to our telecommunications service in Korea’s leading three customer satisfaction indices, the National Customer Satisfaction Index, the Korean Customer Satisfaction Index and the Korean Standard-Service Quality Index, for 28 years, 27 years and 26 years, respectively.

Fixed-line Telecommunications Services

We offer fixed-line telephone, broadband Internet and advanced media platform services (including IPTV and cable TV services), and business communications and related infrastructure services, through our fixed-line telecommunications services segment. Our fixed-line telecommunications services are provided by our

subsidiary, SK Broadband. The following table sets forth historical information about our subscriber base for our fixed-line telecommunications services for the periods indicated:


	As of December 31,
	2025		2024		2023
	(in thousands)
Fixed-Line Telephone (including VoIP)⁽¹⁾		3,269		3,364		3,464
Broadband Internet⁽²⁾		7,238		7,156		6,926
IPTV⁽³⁾		6,721		6,803		6,728
Cable TV		2,729		2,806		2,821

(1)	Includes subscribers to VoIP services of SK Broadband.

(2)	Excludes dedicated broadband Internet lines for Internet cafes.

(3)	Includes subscribers to SK Broadband’s B tv service and video-on-demand only service subscribers.

In 2025, 2024 and 2023, our fixed-line telecommunications services segment revenue was Won 4,191.1 billion, Won 4,075.4 billion and Won 3,928.0 billion, respectively, representing 24.5%, 22.7% and 22.3%, respectively, of our consolidated revenue.

As part of our efforts to enhance our capabilities and increase our market share in the fixed-line business, we completed the Tbroad Merger in April 2020. In November 2024, in order to enhance management efficiency and strengthen our control over SK Broadband, we entered into an agreement to acquire an additional 24.8% equity interest in SK Broadband from minority shareholders. Such transaction was completed in May 2025. We owned approximately 99.1% of SK Broadband’s total outstanding shares as of December 31, 2025. Furthermore, in March 2026, in order to enhance management efficiency and strengthen enterprise value through greater strategic flexibility, we entered into an agreement to acquire the remaining 0.9% equity interest in SK Broadband from minority shareholders. Such transaction is currently pending subject to regulatory approval and other customary closing conditions. See “Item 3.D. Risk Factors — Risks Relating to Our Business — Competition may reduce our market share and harm our business, financial condition and results of operations.”

Fixed-line Telephone Services

Our fixed-line telephone services comprise local, domestic long distance, international long distance and VoIP services. VoIP is a technology that transmits voice data through an Internet Protocol network. As of December 31, 2025, we had approximately 3.3 million fixed-line telephone subscribers (including subscribers to VoIP services of SK Broadband). Our fixed-line telephone services are primarily offered under the “B phone” brand name. A portion of our fixed-line telephone services were previously provided through the VoIP services of our subsidiary SK Telink that targeted corporate customers, which business was acquired by SK Broadband in April 2021.

Broadband Internet Access Services

Our broadband Internet access network covered a substantial majority of households in Korea as of December 31, 2025. As of December 31, 2025, we had approximately 7.2 million broadband Internet access subscribers. We offer broadband Internet access products with various throughput speeds, ranging from optical LAN service, which provides maximum data transmission speeds of up to 100 Mbps, to “Giga Premium” and “Giga Premium×10,” which provide maximum data transmission speeds of up to 1 Gbps and 10 Gbps, respectively.

Advanced Media Platform (including IPTV and Cable TV Services)

As part of our initiative to be the leading next-generation platform provider, we provide an advanced media platform with various media content and service offerings.

We have offered video-on-demand services since 2006 and launched real-time IPTV services in 2009. We currently offer IPTV services under the brand name “B tv” with access to as many as 272 high definition channels depending on the subscription service as of December 31, 2025, as well as pay-per-view and subscription-based video-on-demand services providing a wide range of media content, including recent box office movie releases, popular U.S. and other foreign TV shows and various children’s TV programs. We also offer “B tv UHD,” which is an ultra-high definition IPTV service and has a resolution that is four times as high as the standard high definition broadcasting service in the IPTV industry. As of December 31, 2025, we had approximately 6.7 million IPTV subscribers. Since 2018, we have unveiled a number of smart set-up boxes that incorporate voice recognition and command capabilities as well as AI-based services.

In December 2023, we introduced “AI B tv,” Korea’s first AI-powered personalized IPTV service. Once a set top box is turned on, AI B tv automatically recognizes the user and provides hyper-personalized content experience including recommending video-on-demand and other content based on the user’s viewing history analyzed through AI technology. We plan to integrate T-commerce capabilities into AI B tv and allow users to concurrently search for and purchase the apparel and accessories that appear in the video-on-demand content, which are recognized through AI technology. We also plan to further develop and improve our AI B tv service by integrating A. and generative AI technology. In September 2024, we introduced “B tv A. Service,” a new AI voice command service which utilizes A.’s large-language model and allows customers to explore content and receive recommendations.

Following the Tbroad Merger, we have been offering cable TV services under the “B tv Cable” brand with access to as many as 226 channels. As of December 31, 2025, we had approximately 2.7 million cable TV subscribers.

We also offer advertising services on our advanced media platform, primarily consisting of advertisements on video-on-demand and streaming contents and our TV channels. In addition, in May 2024, we began to offer access to the over-the-top content offerings of Netflix through our IPTV set-top boxes at a bundled discount with our IPTV subscriptions.

SK Broadband also operates two TV channels and co-produces original television entertainment contents through our indirect subsidiary Media S. In December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa, which operates our T-commerce business, and Media S to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions.

We continue to expand the scope of our media services and content offerings to provide our subscribers with a vast library of high-quality content that can be accessed through our wireless networks and our fixed-line network, which we believe will also increase the appeal of our advanced media platform to businesses as an advertising platform.

Business Communications and Related Infrastructure Services

Through SK Broadband, we offer business communications and related infrastructure services to our business customers, including corporations and government entities. Our business communications and related infrastructure services offered by SK Broadband include leased line solutions, Internet data center solutions and network solution services.

Our leased line solutions are exclusive lines that allow point-to-point connection for voice and data traffic between two or more geographically separate points. We hold a license to operate leased line services on a nationwide basis in Korea and also use international transmission lines to provide leased line services to other countries. Our leased line services enable high volumes of data to be transmitted swiftly and reliably. We also

provide back-up storage for transmitted data. Through our Internet data centers, we provide our business subscribers with server-based support including co-location, dedicated server hosting and cloud computing services. In June 2025, SK Broadband acquired the business operations of the Pangyo Data Center from SK Inc. for Won 506.8 billion as part of its initiative to expand its data center operations and generate synergy. Our network solution service utilizes our network infrastructure and voice platform to provide 24-hour monitoring and control of our customers’ networks. Through this service, we conduct remote monitoring of our customers’ data and voice communications infrastructure and network and traffic conditions, and carry out preventive examinations and on-site visits.

Rate Plans

For our residential customers, we offer both bundled rate plans for a combination of our fixed-line service offerings as well as individual rate plans for each separate service offering. Bundled rate plans are offered at a discount compared to subscribing to the same services through individual rate plans. Approximately 87% of subscribers to our broadband Internet services subscribe to two or more of our services through our bundled rate plans. Bundled rate plans for a combination of fixed-line telephone, broadband Internet access and IPTV or cable TV services, which are subject to a contract of one to three years, range from Won 33,000 to Won 111,100 per month, depending on the services included and the length of the contract. We also offer bundled rate plans combining our fixed-line telecommunications services with our wireless services, the physical security services of SK Shieldus Co., Ltd., and subscriptions to Netflix, as well as bundled rate plans that provide discounts for family members or co-inhabitants of the same household.

Our “5,000 minute” plan for subscribers to our fixed-line telephone service features 5,000 voice minutes for domestic land-to-land calls for a fixed rate and range from Won 7,700 to Won 11,550 per month depending on whether or not the subscriber opts for a long-term contract and if so, the length of the contract period. We offer individual fixed-rate plans for our broadband Internet access service that range from Won 30,800 to Won 104,500 per month depending on the data throughput speed and existence and length of a contract. We offer individual fixed-rate plans for our IPTV and cable TV services that range from Won 4,400 to Won 50,600 per month depending on the number of channels provided and existence and length of a contract. In addition, subscribers can purchase individual videos on demand or subscribe to certain paid content on a periodic basis.

With respect to our business communications and related infrastructure services, we offer rates that are tailored to the specific needs of our business customers. We also charge certain installation fees and equipment rental fees as well as other ancillary fees with respect to certain of our fixed-line telecommunications services.

Marketing, Distribution and Customer Service

We focus on bringing our fixed-line telephone, broadband Internet and advanced media platform services (including IPTV and cable TV services) to residential users, and various business communications and related infrastructure services to corporate users. We market our fixed-line telecommunications products and services under the “B” brand. Our “B” brand signifies our pursuit of creating a “Borderless” media ecosystem with “Beloved” content offerings to transform our business to go “Beyond” simply offering connectivity to customers. It also seeks to emphasize our commitment to stand “Beside” our customers to “Bridge” their worlds, leading to “Bravo” and “Blissful” customer experience. Our “B” brand also strengthens our shared identity with our wireless service’s “T” brand.

We operate an extensive distribution network, including regional marketing branch offices and numerous customer centers, large retail stores and authorized dealers across Korea, in order to increase subscriber growth while reducing subscriber acquisition costs. In addition, SK Telecom’s direct retail stores and authorized dealers for wireless telecommunications services also market our fixed-line telephone, broadband Internet and advanced media platform services (including IPTV and cable TV services), which we believe has contributed to the increase in the number of subscribers to such services. We have contracts with our customer centers to sell our services exclusively. These centers receive a commission for each service contract and installation contract

secured. Customer centers often enter into sub-contracts with smaller distribution outlets within their area to increase their sales coverage and engage in telemarketing efforts. Authorized dealers are entitled to an initial commission for each new subscriber registered by the dealer.

In addition, we operate an online distribution channel, “B Direct Shop,” through which subscribers can conveniently subscribe online to our pay TV, broadband Internet and residential fixed-line telephone services. In light of increasing customer preference for online service, the level of distribution of our services through the B Direct Shop has consistently increased in recent years. We intend to continue to develop our online distribution channel to leverage our offline distribution capabilities to provide convenience and additional value to our subscribers.

Sales to business subscribers are handled through our in-house sales group as well as a small-scale distribution network. Our in-house sales group focuses on large business clients such as major corporations, public institutions and governmental agencies. Our small-scale distribution network, on the other hand, targets smaller business clients such as small businesses and sole proprietorship businesses.

Other Businesses

We strive to continually diversify our products and services and develop new businesses that we believe are complementary to our existing products and services, which we include in our other businesses segment. In 2025, 2024 and 2023, the revenue of our other businesses segment, which primarily consisted of our T-commerce and former portal service businesses, was Won 355.6 billion, Won 547.0 billion and Won 557.3 billion, respectively, representing 2.1%, 3.0% and 3.2%, respectively, of our consolidated revenue. See “Item 5.A. Operating Results — Overview — Operational Efficiency.”

We operate a T-commerce network, “SK stoa,” through our consolidated subsidiary SK Stoa, which offers a broad assortment of goods and services through pre-recorded television programming. The goods and services promoted on SK stoa’s T-commerce programming can be purchased through telephone orders, SK stoa’s mobile application or online open marketplace, or a virtual application appearing on the television screen using the viewer’s remote controller. Since 2019, SK Stoa has offered searchable shopping programming that is available to viewers at their convenience by utilizing video-on-demand capabilities. SK Stoa also operates several private fashion and health supplement brands. SK stoa also acts as the exclusive T-commerce distributor for certain products and services of SK Group companies, such as food, electronics, home appliances and car rentals.

In December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa and Media S, which operates two TV channels and co-produces original television entertainment contents as described above, to Rapport Labs Inc. as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions.

Prior to the completion of the disposal transactions described below, we also offered online portal services under our “Nate” brand name through our former subsidiary NATE Communications Corporation, and online corporate employment benefits management and training services for Korean businesses and public institutions through our former indirect subsidiary SK M&Service. In December 2024, as part of our efforts to increase our operational efficiency and re-balance our business areas, we entered into agreements with Samgu Inc. and its affiliates to dispose of our 100% equity interest in NATE Communications Corporation and a 70% equity interest in SK M&Service, as well as our interest in a former non-consolidated associate. The disposals of NATE Communications Corporation, SK M&Service and F&U Credit Information were completed in January 2025, February 2025 and April 2025, respectively. See “Item 5.A. Operating Results — Overview — Operational Efficiency.”

Interconnection

Our wireless and fixed-line networks interconnect with the public switched telephone networks operated by KT and SK Broadband and, through their networks, with the international gateways of KT and LG U+, as well as

the networks of the other wireless telecommunications service providers in Korea. These connections enable our subscribers to make and receive calls from telephones outside our networks. Under Korean law, certain service providers, including us, are required to permit other service providers to interconnect to their networks. If a new service provider desires interconnection with the networks of an existing service provider but the parties are unable to reach an agreement within 90 days, the new service provider can appeal to the KMCC.

Domestic Calls

Guidelines issued by the MSIT require that all interconnection charges levied by a regulated carrier take into account (i) the actual costs to that carrier of carrying a call or (ii) imputed costs. The MSIT determines interconnection rates applicable to each carrier based on changes in traffic volume, taking into account other factors such as research results, competition and trends in technology development.

Wireless-to-Fixed-line. According to our interconnection arrangement with KT, for a call from our wireless network to KT’s fixed-line network, we collect the usage rate from our wireless subscriber and in turn pay KT the interconnection charges. Similarly, KT pays interconnection charges to SK Broadband for a call from KT’s wireless network to SK Broadband’s fixed-line network. The interconnection rate applicable to both KT and SK Broadband was Won 6.73 per minute, Won 6.89 per minute and Won 7.22 per minute for 2025, 2024 and 2023, respectively.

Fixed-line-to-Wireless. The MSIT determines interconnection arrangements for calls from a fixed-line network to a wireless network. For a call initiated by a fixed-line user to one of our wireless subscribers, the fixed-line network operator collects our usage fee from the fixed-line user and remits to us an interconnection charge. Interconnection with KT accounts for substantially all of our fixed-line-to-wireless interconnection revenue and expenses. The interconnection rate paid by fixed-line network service providers to each wireless network service provider was Won 8.15 per minute, Won 8.55 per minute and Won 9.17 per minute for 2025, 2024 and 2023, respectively.

Wireless-to-Wireless. Interconnection charges also apply to calls between wireless telephone networks in Korea. Under these arrangements, the operator originating the call pays an interconnection charge to the operator terminating the call. The applicable interconnection rate is the same as the fixed-line-to-wireless interconnection rate set out in the paragraph above.

Our revenues from the wireless-to-wireless interconnection charges were Won 341.5 billion in 2025, Won 370.1 billion in 2024 and Won 401.3 billion in 2023. Our expenses from these charges were Won 335.4 billion in 2025, Won 364.9 billion in 2024 and Won 392.4 billion in 2023.

International Calls and International Roaming Arrangements

With respect to international calls, if a call is initiated by our wireless subscribers, we bill the wireless subscriber for the international charges of KT, LG U+ or SK Broadband, and we receive interconnection charges from such operators. If an international call is received by our subscriber, KT, LG U+ or SK Broadband pays interconnection charges to us based on our imputed costs.

To complement the services we provide to our subscribers in Korea, we offer international voice and data roaming services. We charge our subscribers usage fees for global roaming service and, in turn, pay foreign wireless network operators fees for the corresponding usage of their network. For a more detailed discussion of our global roaming services, see “— Wireless Services” above.

Competition

We operate in highly saturated and competitive markets, and we believe that our subscriber growth is affected by many factors, including the expansion and technical enhancement of our networks, the development

and deployment of new technologies, the effectiveness of our marketing and distribution strategy, the quality of our customer service, the introduction of new products and services, competitive pricing of our rate plans, new market entrants and regulatory changes.

The following table shows the market share information, based on number of subscribers, as of December 31, 2025, for the following markets.


	Market Share (%)
	SK Telecom			KT			LG U+			Others
Mobile phone⁽¹⁾		41.6	%		30.8	%		27.6	%		—	%
Fixed-Line Telephone (including VoIP)		15.6			51.6			18.1			14.7
Broadband Internet		28.7			40.3			22.1			8.9
Pay TV ⁽²⁾		25.9	⁽³⁾		36.7	⁽⁴⁾		25.1	⁽⁵⁾		12.2

(1)	Includes MVNO subscribers that lease the wireless networks of the respective mobile network operator.

(2)	Includes video-on-demand only service subscribers. Market share is expressed as a percentage of the pay TV market (which includes IPTV, cable TV and satellite TV).

(3)	Consists of 18.4% from our IPTV service and 7.5% from our cable TV service.

(4)	Consists of 26.2% from KT’s IPTV service, 7.1% from its satellite TV service provided through KT Skylife and 3.4% from KT’s cable TV service provided through HCN, which was acquired by KT in August 2021.

(5)	Consists of 15.7% from LG U+’s IPTV service and 9.4% from its cable TV service provided through LG HelloVision, a subsidiary of LG U+.

Cellular Services

As of December 31, 2025, we had 23.5 million mobile phone subscribers, representing a market share of approximately 41.6%, including MVNO subscribers leasing our networks. As of December 31, 2025, KT and LG U+ had 17.4 million and 15.6 million mobile phone subscribers, respectively, representing approximately 30.8% and 27.6%, respectively, of the total number of mobile phone subscribers in Korea on such date, each including MVNO subscribers leasing its networks.

In 2025, we had 1.9 million activations and 2.9 million deactivations. In 2025, the monthly churn rate in our wireless telecommunications business ranged from 0.7% to 2.3%, with an average monthly churn rate of 1.1%, which increased from 0.8% in 2024. The increases in deactivations and average monthly churn rate in 2025 compared to 2024 were mainly due to the cybersecurity incident of which we became aware in April 2025 as described above. See “— Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.”

In recent years, a number of new entrants have entered the MVNO business, including affiliates of leading financial institutions in Korea. Some of these new entrants have engaged in aggressive marketing campaigns and

promotional discounts while leveraging the brand power of their affiliates as part of their efforts to gain subscribers. Partly as a result of such efforts, the combined market share of MVNOs has generally increased in recent years, including from 16.9% as of December 31, 2024 to 18.3% as of December 31, 2025, in terms of number of mobile phone subscribers. In January 2025, the Government announced a number of new policy measures to strengthen the competitiveness of MVNOs, including lowering the cost of leasing networks from wireless network providers (including us) and providing support for the emergence of “full MVNOs” possessing their own core network infrastructures and telephone platform operations. We cannot assure you that such policy measures will not lead to further increases in the combined market share of MVNOs or encourage new MVNOs to enter the market.In addition, other companies may enter the wireless network services market. See “— Law and Regulation — Frequency Allocation” and “Item 3.D. Risk Factors — Risks Relating to Our Business — Our businesses are subject to various types of Government regulation, and any change in Government policy relating to the telecommunications industry could have an adverse effect on our business, financial condition and results of operations.” For a description of the risks associated with the competitive environment in which we operate, see “Item 3.D. Risk Factors — Risks Relating to Our Business — Competition may reduce our market share and harm our business, financial condition and results of operations.”

Historically, competition in the wireless telecommunications business had caused us to significantly increase our marketing and advertising expenses from time to time depending on the prevailing competitive landscape, with marketing expenses as a percentage of SK Telecom’s revenue, on a separate basis, reaching a peak of 28.2% in 2012. Such percentage was 24.2% in 2023, 22.8% in 2024 and 24.1% in 2025. We believe that the maturity of the overall wireless telecommunication market has contributed to the general stabilization of our marketing expenses in recent years.

We face competition from KT and LG U+ as well as other platform service providers in our other cellular service businesses. For example, our Smart Home service competes with KT’s Giga IoT Home service and LG U+’s IoT@Home service.

Fixed-Line Telecommunications Services

Our fixed-line telephone service competes with KT and LG U+, as well as other providers of VoIP services. As of December 31, 2025, our market share of the fixed-line telephone and VoIP service market was 15.6% (including the services provided by SK Broadband) in terms of number of subscribers compared to KT with 51.6% and LG U+ with 18.1%.

We are the second-largest provider of broadband Internet access services in Korea in terms of both revenue and subscribers, and our network covered a substantial majority of households in Korea as of December 31, 2025. As of December 31, 2025, our market share of the broadband Internet market was 28.7% in terms of number of subscribers compared to KT with 40.3% and LG U+ with 22.1%.

Our IPTV and cable TV services compete with other providers of pay TV services, including KT, LG U+ and cable companies. As of December 31, 2025, our market share of the pay TV market (which includes IPTV, cable TV and satellite TV) was 25.9% compared to KT with 36.7% (including its IPTV, cable TV and satellite TV services) and LG U+ with 25.1% (including its IPTV and cable TV services), and the collective market share of other pay TV providers was 12.2%. Our market shares in the broadband Internet and pay TV markets in 2025 were marginally and negatively affected by the impact of the above-mentioned cybersecurity incident, as a significant portion of our customers of these services subscribe to packages that combine our mobile phone services with one or both of these services. Furthermore, our IPTV and cable TV services are facing an increasing level of competition from global operators of online video streaming platforms, such as YouTube, Netflix, Disney Plus and Apple TV, leading domestic video streaming platforms such as TVING, Coupang Play, Wavve (which is seeking to merge with TVING pursuant to a memorandum of understanding entered into in December 2023) and Watcha, and the video contents offered by leading domestic and global internet search, communications and social media platforms including NAVER, Kakao and Instagram, as such services continue to become increasingly popular to serve as a substitute to traditional television programming.

Over the past decade, the Korean fixed-line telecommunications industry has gone through significant consolidation involving major pay television service providers. We completed the Tbroad Merger in April 2020, following which we became the second-largest pay TV provider in Korea in terms of number of subscribers as of December 31, 2025. In December 2019, LG U+ acquired a majority equity stake in LG HelloVision. In August 2021, KT acquired HCN, a major Korean cable TV service provider, through its subsidiary KT Skylife. Such transactions, as well as further consolidation in the fixed-line telecommunications industry, may result in increased competition, as the entities emerging from such consolidation and other remaining players in the industry may actively pursue expanding or protecting their respective market shares.

Other Investments and Relationships

We have investments in a number of other businesses and companies and have entered into various business arrangements with other companies. For example, in July 2022, we entered into a strategic alliance with Hana Financial Group, a leading financial holding company in Korea with subsidiaries having significant presences in commercial banking, credit card business, securities brokerage and insurance, among others, to seek synergies through convergence between finance and ICT technology. As part of such strategic alliance, we transferred the entirety of our 15.0% interest in HanaCard for Won 330.0 billion in July 2022 and acquired 8,630,949 shares of Hana Financial Group (representing a 2.9% interest) for Won 330.0 billion between July and November 2022, and HanaCard acquired 1,307,471 common shares of us (representing a 0.6% interest) for Won 68.4 billion between July and September 2022. See also “— Cellular Services — Other Solutions and Services — Other New Businesses.”

Law and Regulation

Overview

Korea’s telecommunications industry is subject to comprehensive regulation by the MSIT, which is responsible for information and telecommunications policies. The MSIT regulates and supervises a broad range of communications issues, including:

•

entry into the telecommunications industry;

•

scope of services provided by telecommunications service providers;

•

allocation of radio spectrum;

•

setting of technical standards and promotion of technical standardization;

•

rates, terms and practices of telecommunications service providers;

•

interconnection and revenue-sharing between telecommunications service providers;

•

research and development of policy formulation for information and telecommunications; and

•

competition among telecommunications service providers.

The MSIT is charged with regulating information and telecommunications, and the KMCC is charged with regulating the public interest aspects of and fairness in broadcasting and telecommunications.

Telecommunications service providers are currently classified into two categories: network service providers and value-added service providers. We are classified as a network service provider because we provide telecommunications services with our own telecommunications networks and related facilities. As a network service provider, we were previously required to obtain a license from the MSIT for the services we provide. However, an amendment to the Telecommunications Business Act, pursuant to which companies meeting certain regulatory criteria may become a network service provider without a separate license requirement, went into effect in June 2019. Our licenses permit us to provide cellular services, third generation wireless telecommunications services using WCDMA technology, fourth generation wireless telecommunications services using LTE technology and fifth generation wireless telecommunications services using 5G technology.

The MSIT may revoke our licenses or suspend any of our businesses if we fail to comply with its rules, regulations and corrective orders, including the rules restricting beneficial ownership and control and corrective orders issued in connection with any violation of rules restricting beneficial ownership and control or any violation of the conditions of our licenses. Alternatively, in lieu of suspension of our business, the MSIT may levy a penalty surcharge of up to 3.0% of the average of our annual revenue for the preceding three fiscal years. A network service provider that wants to cease its business or dissolve must notify its users 60 days prior to the scheduled date of cessation or dissolution and obtain MSIT approval.

In the past, the Government has stated that its policy was to promote competition in the Korean telecommunications market through measures designed to prevent the dominant service provider in any such market from exercising its market power in such a way as to prevent the emergence and development of viable competitors. While all network service providers are subject to MSIT regulation, we are subject to increased regulation because of our position as the dominant wireless telecommunications services provider in Korea.

Competition Regulation

The KMCC is charged with ensuring that network service providers engage in fair competition and has broad powers to carry out this goal. If a network service provider is found to be in violation of the fair competition requirement, the KMCC may take corrective measures it deems necessary, including, but not limited to, prohibiting further violations, requiring amendments to the articles of incorporation or to service contracts with customers, requiring the execution or performance of, or amendments to, interconnection agreements with other network service providers and prohibiting advertisements to solicit new subscribers. The KMCC is required to notify the Minister of the MSIT upon ordering certain corrective measures.

In addition, we may also be designated as a “market-dominating business entity” by the relevant authorities under the Fair Trade Act, based on a case-by-case assessment of factors such as our market share, barriers to entry and the relative scale of competitors. If so designated, we would be prohibited from engaging in conduct that could be deemed an abuse of such position, including unreasonably determining, maintaining or altering service rates, unreasonably controlling the rendering of services, unreasonably interfering with business activities of other business entities, hindering unfairly the entry of newcomers or substantially restricting competition to the detriment of the interests of consumers.

Because we are a member company of the SK Group, which is a large business group as designated by the KFTC, we are subject to the following restrictions under the Fair Trade Act:

•

Restriction on debt guarantee among affiliates. Any affiliate within the SK Group may not guarantee the debts of another domestic affiliate, except for certain guarantees prescribed in the Fair Trade Act, such as those relating to the debts of a company acquired for purposes of industrial rationalization, bid deposits for overseas construction work or technology development funds.

•

Restriction on cross-investment. A member company of the SK Group may not acquire or hold shares in an affiliate belonging to the SK Group that owns shares in the member company.

•

Restrictions on circular investments. A member company of the SK Group may not acquire or hold shares which would constitute “circular investments” in an affiliate company which also forms part of the SK Group where “circular investments” refer to a cross-affiliate shareholding relationship under which three or more affiliate companies become connected through cross affiliate shareholdings by owning shares in other affiliates or by becoming an entity whose shares are owned by other affiliates.

•

Public notice of board resolution on large-scale transactions with specially related persons. If a member company of the SK Group engages in a transaction with a specially related person in an amount exceeding the lesser of (1) Won 10 billion and (2) 5.0% of the larger of the total capital or capital stock of the member company (provided, however, in cases where 5.0% of the total capital or

capital stock of the member company is less than Won 500 million, the threshold set forth in (2) above is set at Won 500 million), the transaction must be approved by a resolution of the member company’s board of directors and the member company must publicly disclose the transaction.

•

Restrictions on investments by subsidiaries and sub-subsidiaries of holding companies. The Fair Trade Act prohibits subsidiaries of holding companies from investing in, or holding shares of common stock of, domestic affiliates that belong to the same large business group, unless such domestic affiliates are their own subsidiaries. Furthermore, any subsidiaries of a holding company’s subsidiaries (“sub-subsidiaries”) are prohibited from investing in, or holding shares of common stock of, domestic affiliates that belong to the same large business group, unless all shares issued by the affiliates are held by the sub-subsidiary. Therefore, we and other subsidiaries of SK Inc. may not invest in any domestic affiliate that is also a member company of the SK Group, except in the case where we invest in our own subsidiary or where another subsidiary of SK Inc. invests in its own subsidiary.

•

Public notice of the current status of a business group. Under the Fair Trade Act and the Enforcement Decree thereof, a member company of the SK Group must publicly disclose the general status of the SK Group, including the name, business scope and financial status of affiliates, information on the officers of affiliates, information on shareholding and cross-investments between member companies of the SK Group, information on transactions with certain related persons and, if a member company engages in a transaction with an affiliated company in the amount of 5.0% or more of the member company’s quarterly sales or Won 5.0 billion or more, information on transactions with such affiliated company on a quarterly basis.

Rate Regulation

Network service providers whose sales proceeds exceed the amount prescribed by law must report to the MSIT the rates and contractual terms for each type of service they provide. Under the current reporting requirement, which does not apply to other network service providers with respect to the rates they provide, the MSIT has fifteen days to object to any new rates and terms of service reported by us, and we may implement such new rates and terms of service after the fifteen-day period expires in the absence of the MSIT’s objection.

Furthermore, in 2007, the Government announced a “road map” highlighting revisions in regulations to promote deregulation of the telecommunications industry. In accordance with the road map and pursuant to the Combined Sales Regulation, promulgated in May 2007, telecommunications service providers in Korea are permitted to bundle their services, such as wireless data transmission service, wireless voice transmission service, broadband Internet access service, fixed-line telephone service and IPTV service, at a discounted rate; provided, however, that we and KT, each of which holds a significant market share in the telecommunications industry, allow other competitors to employ the services provided by us and KT, respectively, so that such competitors can provide similar discounted package services. In September 2007, the regulations and provisions under the Telecommunications Business Act were amended to permit licensed transmission service providers to offer local, domestic long-distance and international telephone services, as well as broadband Internet access and Internet phone services, without additional business licenses.

Moreover, an MVNO system under which the MSIT may designate and obligate certain wireless telecommunications services providers to allow an MVNO, at such MVNO’s request, to use their telecommunications network facilities at a rate mutually agreed upon that complies with the standards set by the MSIT became effective on March 14, 2017 under the amended Telecommunications Business Act. We are currently the only wireless telecommunications services provider obligated to allow other wireless telecommunications services providers to use our telecommunications network facilities. Currently, 15 MVNOs provide wireless telecommunications services using the networks leased from us.

On October 1, 2014, the MDDIA, enacted for the purpose of establishing a transparent and fair mobile distribution practice, became effective. The MDDIA limited the amount of subsidies a wireless

telecommunications service provider can provide to subscribers in order to prevent excessive competition among wireless telecommunications service providers. Pursuant to the MDDIA, wireless telecommunications service providers are prohibited from (i) unfairly providing discriminatory subsidies based on criteria such as type of subscription, subscription plan and characteristics of the subscriber and (ii) entering into a separate agreement with subscribers imposing obligations to use a specific subscription plan as a condition for providing subsidies. See “Item 5.A. Operating Results — Overview — Rate Regulations.”

In addition, under the MDDIA, wireless telecommunications service providers were obliged to provide certain benefits, such as discounted rates, to subscribers who subscribe to their service without receiving subsidies. In June 2017, the State Affairs Planning Advisory Committee of Korea announced that it would encourage wireless telecommunications service providers, including us, to increase the applicable discount rate offered to subscribers from 20% to 25%, which we adopted in September 2017, and to offer additional discounts to low income customers, including those on government welfare programs and senior citizen recipients of the basic pension, which we implemented in December 2017 and July 2018, respectively. Although the MDDIA was repealed in July 2025, discounted rates offered under the MDDIA have been retained through a related amendment to the Telecommunications Business Act. We cannot provide assurance that we will not provide other rate discounts or lower-priced subscription plans in the future to comply with the Government’s public policy guidelines or suggestions.

Interconnection

Dominant network service providers such as ourselves that own essential infrastructure facilities or possess a certain market share are required to provide interconnection of their telecommunications network facilities to other service providers upon request. The MSIT sets and announces the standards for determining the scope, procedures, compensation and other terms and conditions of such provision, interconnection or co-use. We have entered into interconnection agreements with KT, LG U+ and other network service providers permitting these entities to interconnect with our network. We expect that we will be required to enter into additional agreements with new operators as the MSIT grants permits to additional telecommunications service providers.

Frequency Allocation

The MSIT has the discretion to allocate and adjust the frequency bandwidths for each type of service and may auction off the rights to certain frequency bandwidths. Upon allocation of new frequency bandwidths or adjustment of frequency bandwidths, the MSIT is required to give a public notice. The MSIT also regulates the frequency to be used by each radio station, including the transmission frequency used by equipment in our base stations. All of our frequency allocations are for a definite term. We pay fees to the MSIT for our frequency usage that are determined based upon our number of subscribers, frequency usage by our networks and other factors. For 2025, 2024 and 2023, the fee amounted to Won 99.8 billion, Won 103.0 billion and Won 102.5 billion, respectively.

We currently use 10 MHz of bandwidth in the 2.1 GHz spectrum for our WCDMA services, 30 MHz of bandwidth in the 2.1 GHz spectrum, 20 MHz of bandwidth in the 800 MHz spectrum, 35 MHz of bandwidth in the 1.8 GHz spectrum and 60 MHz of bandwidth in the 2.6 GHz spectrum for our LTE services, as well as 100 MHz of bandwidth in the 3.5 GHz spectrum for our 5G services. In December 2022, citing the lack of progress made to date with respect to the implementation of 5G infrastructure for our use of the 28 GHz spectrum (800 MHz of bandwidth which was allocated to us in December 2018 for a period of five years until November 2023), the MSIT reduced the duration of our license for the use of such bandwidth by six months and asked us to install 15,000 base stations that use the 28 GHz spectrum by the end of May 2023, which we were not able to do within the Government’s requested timetable. Furthermore, in December 2022, the Government cancelled the allocations of bandwidth in the 28 GHz spectrum that had been provided to KT and LG U+, also citing the lack of progress made by these companies. In January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X to provide nationwide wireless network services. However, in July 2024, the

Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application. For more information regarding the license fees for the various bandwidths that we use, see “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures” and note 16 of the notes to our consolidated financial statements.

In December 2025, the MSIT announced plans to reallocate a total of 370 MHz of frequency bandwidths whose usage terms are due to expire in 2026 to KT, LG U+ and us, 155 MHz (in the 800 MHz, 1.8 GHz, 2.1 GHz and 2.6 GHz spectrums) of which will be allocated to us. We have applied for the renewal of the 20 MHz frequency bandwidth in the 800 MHz spectrum in December 2025, and we plan to apply for the renewal of the remaining 135 MHz of frequency bandwidths in June 2026. The final consideration to be paid by us for such reallocated bandwidths is expected to be conditional on the number of indoor 5G cell sites to be constructed by us by 2031. For risks relating to the maintenance of adequate bandwidth capacity, see “Item 3.D. Risk Factors — Risks Relating to Our Business — Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage.”

Mandatory Contributions and Obligations

All telecommunications service providers other than (i) value-added service providers and regional paging service providers or (ii) any telecommunications service providers whose net annual revenue is less than an amount determined by the MSIT (currently set at Won 30.0 billion) are required to provide “universal” telecommunications services including local telephone services, local public telephone services, telecommunications services for remote islands and wireless communication services for ships and discounted telephone services for handicapped and low-income citizens, or contribute toward the supply of such universal services. The MSIT designates universal services and the service provider who is required to provide each service. Currently, under the MSIT guidelines, we are required to offer a discount of between 35.0% to 50.0% of our monthly fee for wireless telecommunications services to handicapped and low-income citizens.

In addition to such universal services for handicapped and low-income citizens, we are also required to make certain annual monetary contributions to compensate for other service providers’ costs for the universal services. The size of a service provider’s contribution is based on its net annual revenue for the previous year (calculated pursuant to the MSIT guidelines, which differ from our accounting practices). We recognized expenses relating to such contributions of Won 9.7 billion, Won 35.2 billion and Won 31.1 billion in 2025, 2024 and 2023, respectively. As a wireless telecommunications services provider, we are not considered a provider of universal telecommunications services and do not receive funds for providing universal service. Other network service providers that do provide universal services make all or a portion of their “contribution” in the form of expenses related to the universal services they provide.

Foreign Ownership and Investment Restrictions and Requirements

Because we are a network service provider, and the exception for the foreign shareholding limit under the Telecommunications Business Act does not apply to us, foreign governments, individuals, and entities (including Korean entities that are deemed foreigners, as discussed below) are prohibited from owning more than 49.0% of our voting stock. Korean entities whose largest shareholder is a foreign government or a foreigner (together with any of its related parties) that owns 15.0% or more of the outstanding voting stock of such Korean entities are also deemed foreigners. If this 49.0% ownership limitation is violated, certain of our foreign shareholders will not be permitted to exercise voting rights in excess of the limitation, and the MSIT may require other corrective action.

aggregating the shareholdings of such shareholder and its related parties) is a foreign entity specifically designated by the MSIT incorporated in a country that has entered into a bilateral or multilateral free trade agreement with Korea, and (ii) such shareholder (together with the shareholdings of its related parties) owns 15.0% or more of the issued voting stock of such entity, may own more than 49.0% of our issued shares but may not exercise its voting rights with respect to the shares held in excess of the 49.0% ceiling until the end of the MSIT’s Public Interest Review.

As of December 31, 2025, SK Inc. owned 65,668,397 shares of our common stock, or 30.6%, of our issued shares. As of December 31, 2025, the two largest foreign shareholders of SK Inc. each held a 3.4% stake therein. If such foreign shareholders increase their shareholdings in SK Inc. to 15% or more and any such foreign shareholder constitutes the largest shareholder of SK Inc., SK Inc. will be considered a foreign shareholder, and its shareholding in us would be included in the calculation of our aggregate foreign shareholding. If SK Inc.’s shareholding in us is included in the calculation of our aggregate foreign shareholding, then our aggregate foreign shareholding, assuming the foreign ownership level as of December 31, 2025 (which we believe was 36.2%), would exceed the 49.0% ceiling on foreign shareholding.

If our aggregate foreign shareholding limit is exceeded, the MSIT may issue a corrective order to us, the breaching shareholder (including SK Inc. if the breach is caused by an increase in foreign ownership of SK Inc.) and the foreign shareholder which owns in the aggregate 15.0% or more of SK Inc. Furthermore, SK Inc. will be prohibited from exercising its voting rights with respect to the shares held in excess of the 49.0% ceiling, which may result in a change in control of us. In addition, the MSIT will be prohibited from granting us licenses or permits necessary for entering into new telecommunications businesses until our aggregate foreign shareholding is reduced to below 49.0%. If a corrective order is issued to us by the MSIT arising from the violation of the foregoing foreign ownership limit, and we do not comply within the prescribed period under such corrective order, the MSIT may:

•

revoke our business license;

•

suspend all or part of our business; or

•

if the suspension of business is deemed to result in significant inconvenience to our customers or to be detrimental to the public interest, impose a one-time administrative penalty of up to 3.0% of the average of our annual revenue for the preceding three fiscal years.

Additionally, the Telecommunications Business Act also authorizes the MSIT to assess penalty surcharges of up to 0.3% of the purchase price of the shares for each day the corrective order is not complied with, as well as a prison term of up to three years or a penalty of Won 150 million. See “Item 3.D. Risk Factors — Risks Relating to Our Business — If SK Inc. causes us to breach the foreign ownership limitations on our common shares, we may experience a change of control.”

We are required under the Foreign Exchange Transactions Act to file a report with a designated foreign exchange bank or with the MOFE, in connection with any issue of foreign currency denominated securities by us in foreign countries. Issuances of US$30 million or less require the filing of a report with a designated foreign exchange bank, and issuances that are over US$30 million in the aggregate within one year from the filing of a report with a designated foreign exchange bank require the filing of a report with the MOFE.

The Telecommunications Business Act provides for the creation of a Public Interest Review Committee under the MSIT to review investments in or changes in the control of network service providers. The following events would be subject to review by the Public Interest Review Committee:

•

the acquisition by an entity (and its related parties) of 15.0% or more of the equity of a network service provider;

•

a change in the largest shareholder of a network service provider;

•

agreements by a network service provider or its shareholders with foreign governments or parties regarding important business matters of such network service provider, such as the appointment of officers and directors and transfer of businesses;

•

a deemed foreigner (as discussed above) from a country whose government has entered into a bilateral or multilateral free trade agreement designated by the MSIT with the Government owning in excess of 49.0% of the outstanding voting stock of a network service provider; and

•

a change in control over a network service provider specified in the Enforcement Decree of the Telecommunications Business Act (including, but not limited to, the change of control over the holding company of such network service provider).

If the Public Interest Review Committee determines that any of the foregoing transactions or events would be detrimental to the public interest, then the MSIT may issue orders to stop the transaction, amend any agreements, suspend voting rights, or divest the shares of the relevant network service provider. Additionally, if a dominant network service provider (which would currently include us and KT), together with its specially related persons (as defined under the Financial Investment Services and Capital Markets Act (the “FSCMA”)), holds more than 5.0% of the equity of another dominant network service provider, the voting rights on the shares held in excess of the 5.0% limit may not be exercised.

Patents and Licensed Technology

Access to the latest relevant technology is critical to our ability to offer the most advanced wireless telecommunications services and to design and manufacture competitive products. In addition to active internal and external research and development efforts as described in “Item 5.C. Research and Development, Patents and Licenses, etc.,” our success depends in part on our ability to obtain patents, licenses and other intellectual property rights covering our products. We own numerous patents and trademarks worldwide, and have applications for patents pending in many countries. Our patents are mainly related to wireless (LTE, 5G and Wi-Fi) technology, video codec, wireless Internet applications and AI.

We are not currently involved in any material litigation regarding patent infringement. For a description of the risks associated with our reliance on intellectual property, see “Item 3.D. Risk Factors — Risks Relating to Our Business — Our business relies on technology developed by us, and our business will suffer if we are unable to protect our proprietary rights.”

Seasonality of the Business

Our business is not affected by seasonality.

Item 4.C.

Organizational Structure

We are a member of the SK Group, based on the definition of “group” under the Fair Trade Act. As of December 31, 2025, SK Group members owned in aggregate 30.6% of the shares of our issued common stock. The SK Group is a diversified group of companies incorporated in Korea with interests in, among other things, telecommunications, trading, energy, chemicals, engineering and leisure industries.

Significant Subsidiaries

For information regarding our subsidiaries, see note 1(2) of the notes to our consolidated financial statements.

Item 4.D.

Property, Plants and Equipment

The following table sets forth certain information concerning our principal properties as of December 31, 2025:


Location	Primary Use	Approximate Area in Square Feet
Seoul Metropolitan Area	Corporate Headquarters		921,727	⁽¹⁾
	Regional Headquarters		608,670
	Customer Service Centers		107,277
	Training Centers		344,966
	Central Research and Development Center		319,789
	Others⁽²⁾		2,452,391
Gyeongsang Provinces	Regional Headquarters		491,706
	Others⁽²⁾		1,267,236
Jeolla and Jeju Provinces	Regional Headquarters		265,614
	Others⁽²⁾		920,200
Chungcheong Province	Regional Headquarters		565,761
	Others⁽²⁾		950,674

(1)	Represents our 93.25% ownership of SK T-Tower.

(2)	Includes base stations.

Our registered office and corporate headquarters are located at SK T-Tower, 65, Eulji-ro, Jung-gu, Seoul 04539, Korea, which occupy a total land area of approximately 64,515 square feet. We own 93.25% of SK T-Tower, while the remaining 6.75% is owned by SK Square following the transfer of such interest to it by us pursuant to the Spin-off. In addition, we own or lease various locations for base stations and switching equipment. We do not anticipate that we will encounter material difficulties in meeting our future needs for any existing or prospective leased space for our base stations. See “Item 4.B. Business Overview — Cellular Services — Network Infrastructure.”

We maintain a range of insurance policies to cover our assets and employees, including our directors and officers. We are insured against business interruption, fire, lightning, flooding, theft, vandalism, public liability and certain other risks that may affect our assets and employees. We believe that the types and amounts of our insurance coverage are in accordance with general business practices in Korea.

Item 4A.

UNRESOLVED STAFF COMMENTS

We do not have any unresolved comments from the SEC staff regarding our periodic reports under the Exchange Act.

Item 5.

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

You should read the following discussion together with our consolidated financial statements and the related notes thereto which appear elsewhere in this annual report. We prepare our consolidated financial statements in accordance with IFRS Accounting Standards as issued by the IASB. In addition, you should read carefully notes 2(4) and 3 of the notes to our consolidated financial statements which provide summaries of certain critical accounting estimates that require our management to make difficult, complex or subjective judgments relating to matters which are highly uncertain and that may have a material impact on our financial conditions and results of operations.

Item 5.A.

Operating Results

Overview

Our operations are reported in three segments: (1) cellular services, which include wireless voice and data transmission services, sales of wireless devices, cellular interconnection services, and various other solutions and services including certain new growth businesses and other miscellaneous cellular services, (2) fixed-line telecommunication services, which include fixed-line telephone services, broadband Internet services, advanced media platform services (including IPTV and cable TV services), and business communications and related infrastructure services, and (3) other businesses, which include our T-commerce business and certain other miscellaneous businesses that do not meet the quantitative thresholds to be separately considered reportable segments.

In our cellular services segment, we earn revenue principally from our wireless voice and data transmission services through monthly plan-based fees, usage charges for outgoing voice calls, usage charges for wireless data services and value-added service fees paid by our wireless subscribers as well as interconnection fees paid to us by other telecommunications operators for use of our wireless network by their customers and subscribers. We also derive revenue from sales of wireless devices by PS&Marketing. Other sources of revenue include revenue from our other miscellaneous cellular services and our new services and products utilizing our AI and digital infrastructure capabilities and our telecommunications platforms, including a broad range of IoT solutions and enterprise communications services, cloud services, subscription services, advertising and curated shopping services, AI B2C services and AI B2B services.

In our fixed-line telecommunication services segment, we earn revenue principally from our fixed-line telephone services and broadband Internet services and advanced media platform services (including IPTV and cable TV services) through monthly plan-based fees and usage charges as well as interconnection fees paid to us by other telecommunications operators for use of our fixed-line network by their customers and subscribers, and advertising fees paid to us by businesses that advertise their products and services on our advanced media platforms. In addition, we derive revenue from international calling services and our business communications and related infrastructure services through customized fee arrangements with our business customers.

In our others segment, we have principally earned revenue from the T-commerce business of SK Stoa, which derives revenue through third-party seller fees earned (including commissions) for transactions in which it acts as a selling agent on SK stoa, its T-commerce network. In December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa and Media S, which operates two TV channels and co-produces original television entertainment contents, to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions, and the assets and liabilities of SK Stoa and Media S are classified as assets and liabilities held for sale in our consolidated financial statements included in this annual report. Prior to the completion of the disposal transactions described below, we also derived revenue from online portal services under our “Nate” brand name through our former subsidiary NATE Communications Corporation, and online corporate employment benefits management and training services for Korean businesses and public institutions through our former indirect subsidiary SK M&Service. See “— Operational Efficiency.”

Our cellular service revenue and fixed-line telecommunications service revenue depend principally upon the number of our subscribers and service users, the rates we charge for our services, the frequency and volume of subscriber usage of our services and the terms of our interconnection with other telecommunications operators. Our others revenue depends principally upon the gross merchandise volume, which is the total monetary value of customer purchases of goods and services, net of estimated refunds, of SK stoa and the number of merchants that utilize SK stoa to advertise and promote their products and services and the extent of such advertisement and promotion.

Among other factors, management uses operating profit of each reportable segment presented in accordance with K-IFRS (“segment operating profit”) in its assessment of the profitability of each reportable segment. The sum of segment operating profit for all three reportable segments differs from our operating profit presented in accordance with IFRS Accounting Standards as issued by the IASB as segment operating profit does not include certain items such as donations, gain and loss from disposal of property and equipment and intangible assets and impairment loss on property and equipment and intangible assets. For a reconciliation of operating profit presented in accordance with IFRS Accounting Standards as issued by the IASB and operating profit presented in accordance with K-IFRS, see “— Explanatory Note Regarding Presentation of Certain Financial Information under K-IFRS.” In addition to the information set forth below, see note 4 of the notes to our consolidated financial statements for more detailed information regarding each of our reportable segments.

A number of recent developments have had or are expected to have a material impact on our results of operations, financial condition and capital expenditures. These developments include:

Rate Regulations. Under the MDDIA, wireless telecommunications service providers were obliged to provide certain benefits, such as discounted rates, to subscribers who subscribe to their service without receiving handset subsidies. Handset subsidies are provided to subscribers who agree to use our service for a predetermined service period and purchase handsets on an installment basis. In June 2017, the State Affairs Planning Advisory Committee of Korea announced that it would encourage wireless telecommunications service providers, including us, to increase the applicable discount rate offered to subscribers from 20% to 25%, which we adopted in September 2017, and to offer additional discounts to low income customers, including those on government welfare programs and senior citizen recipients of the basic pension, which we implemented in December 2017 and July 2018, respectively. Although the MDDIA was repealed in July 2025, discounted rates offered under the MDDIA have been retained through a related amendment to the Telecommunications Business Act. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation.”

These Government measures have adversely affected our revenues and results of operations as more subscribers elected to receive the 25% rate discount in recent years. On the other hand, this has also led to a reduction of, or partially offset increases in, our marketing expenses as the number of subscribers who have elected to receive handset subsidies has generally declined in recent years, and has contributed to maintaining a stable churn rate. Moreover, following the abolishment of the MDDIA as discussed above, we have increased our marketing expenses relating to handset subsidies in part depending on the prevailing competitive landscape, which may have an adverse effect on our operating expenses and results of operations.

Decrease in Interconnection Fees. Our wireless telecommunications services depend, in part, on our interconnection arrangements with domestic and international fixed-line and other wireless networks. Charges for interconnection affect our revenues and operating results. The MSIT determines the basic framework for interconnection arrangements, including policies relating to interconnection rates in Korea. Under our interconnection agreements, we are required to make payments in respect of calls which originate from our networks and terminate in the networks of other Korean telecommunications operators, and the other operators are required to make payments to us in respect of calls which originate in their networks and terminate in our network. The MSIT has continued to gradually decrease the interconnection rates in Korea, which has led to an overall decrease in our interconnection revenue as well as interconnection expenses from 2012 to 2025 and any further reduction in interconnection rates by the MSIT may continue to impact our results of operations. Beginning in 2017, a single interconnection rate paid by fixed-line network service providers for fixed-line to wireless calls applies to all wireless telecommunications service providers. For more information about our interconnection revenue and expenses, see “Item 4.B. Business Overview — Interconnection.”

Changes in Monthly Revenue per Subscriber. We measure monthly average revenue per subscriber using two metrics: average monthly revenue per subscriber excluding MVNO subscribers leasing our networks (“ARPU”) and average monthly revenue per subscriber including such MVNO subscribers (“ARPU including MVNO”). ARPU is derived by dividing the sum of total SK Telecom revenues on a separate basis from voice

service and data service for the period (excluding revenue derived from MVNO subscribers leasing our networks) by the monthly average number of subscribers (excluding the number of MVNO subscribers) for the period, then dividing that number by the number of months in the period. ARPU including MVNO is derived by dividing the sum of total SK Telecom revenues on a separate basis from voice service and data service for the period (including revenue derived from MVNO subscribers) by the monthly average number of subscribers (including the number of MVNO subscribers) for the period, then dividing that number by the number of months in the period.

Our ARPU decreased by 5.1% to Won 27,845 in 2025 from Won 29,355 in 2024, which represented a decrease of 1.7% from Won 29,874 in 2023. Our ARPU including MVNO decreased by 5.5% to Won 26,146 in 2025 from Won 27,658 in 2024, which represented a decrease of 0.8% from Won 27,887 in 2023. The decreases in ARPU and ARPU including MVNO in 2025 were both primarily due to discounts on monthly subscription fees we offered for the month of August 2025 as part of the Customer Appreciation Package following the cybersecurity incident of which we became aware in April 2025 as described above. See “— Overview — Cybersecurity.” The decrease in ARPU in 2024 was primarily due to an increase in subscriptions for secondary mobile phones and non-mobile phone devices, from which we generally derive lower revenue per subscriber, which effect was offset in part by an increase in the number of subscribers that subscribe to our 5G subscription plans. The decrease in ARPU including MVNO in 2024 was primarily due to an increase in the number of MVNO subscribers from whom we derive lower ARPU.

Economic Conditions in Korea. Demand for our products and services may fluctuate in light of the overall economic conditions in Korea. The overall prospects for the Korean economy and, in turn, the market conditions for the industries in which we operate, remain uncertain, and have been affected by, among others, the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia, difficulties faced by several banks in the United States and Europe, fluctuations in policy interest rates globally (including Korea), and more recently, the military conflicts between Iran and other countries, including the United States and Israel, have adversely affected, and may continue to adversely affect, the Korean economy. In addition, an increase in unemployment among, and/or a decrease in disposable income of, our customers resulting from mixed signs of deterioration and uncertain recovery displayed by the Korean economy as described above, may decrease demand for some of our products and services or cause an increase in delinquent subscriber accounts. See “Item 3.D. Risk Factors — Risks Relating to Korea — Unfavorable financial and economic developments in Korea may have an adverse effect on us.”

Operational Efficiency. We are striving to enhance our operational efficiency through our efforts to reduce operating expenses, optimize capital expenditures and reorganize non-essential business lines and investments. For example, in order to streamline our operating expenses, we have been actively utilizing AI technology in various operational processes, including our marketing activities and customer services. Furthermore, we have shifted the focus of our 5G network-related capital expenditure from expanding network coverage and increasing maximum data transmission speed to enhancing network quality. Moreover, in December 2024, we entered into agreements with Samgu Inc. and its affiliates to dispose of a 70% equity interest in SK M&Service, as well as our 100% equity interest in our former wholly-owned subsidiary NATE Communications Corporation, which operates the “Nate” internet portal, and the entirety of our 50% equity interest in our former associate F&U Credit Information, which provides credit information services. The disposals of NATE Communications Corporation, SK M&Service and F&U Credit Information were completed in January 2025, February 2025 and April 2025, respectively. More recently, in December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa, which operates our T-commerce business, and Media S, which operates two TV channels and co-produces original television entertainment contents, to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions, and the assets and liabilities of SK Stoa and Media S are classified as assets and liabilities held for sale in our consolidated financial statements included in this annual report.

Cybersecurity. Our business involves the storage and transmission of large amounts of personal information, and cybersecurity breaches expose us to a risk of loss of this information, which may lead to improper use or disclosure of such information, ensuing potential liability and litigation, and loss of customers, any of which could harm our reputation and adversely affect our business. We maintain a comprehensive process for assessing, identifying and managing material risks from cybersecurity threats as part of our overall risk management system and processes. On April 18, 2025, we became aware of a malware attack against our information technology infrastructure, which resulted in the leakage of certain USIM information of our 5G and LTE network subscribers. While we have addressed such incident with various remedial measures, including ongoing and planned investments in strengthening our cybersecurity and customer compensation packages, such incident resulted in a decrease in the number of our mobile phone subscribers and has had a negative impact on the average monthly churn rate of our wireless telecommunications business. In addition, on August 27, 2025, the PIPC imposed a fine of Won 134.8 billion and an administrative penalty of Won 9.6 million and issued a correctional order on us in connection with this incident. While we have provisionally paid the fine and the administrative penalty in full, we filed an administrative lawsuit challenging such decision in January 2026, which case is currently pending before the Seoul Administrative Court. See “Item 3.D. Risk Factors — Risks Relating to Our Business — Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers” and “Item 16K. Cybersecurity.”

Explanatory Note Regarding Presentation of Certain Financial Information under K-IFRS

In addition to preparing consolidated financial statements in accordance with IFRS Accounting Standards as issued by the IASB included in this annual report, we also prepare financial statements in accordance with Korean International Financial Reporting Standards (“K-IFRS”) as adopted by the Korean Accounting Standards Board (“KASB”), which we are required to file with the FSC and the Korea Exchange under the FSCMA.

K-IFRS requires operating profit, which is calculated as operating revenue less operating expenses, to be separately presented on the consolidated statement of income. The presentation of operating profit in our consolidated statements of income prepared in accordance with IFRS Accounting Standards as issued by the IASB included in this annual report differs from the presentation of operating profit in the consolidated statements of income prepared in accordance with K-IFRS for the corresponding periods in certain respects. The table below sets forth a reconciliation of our operating profit as presented in our consolidated statements of income prepared in accordance with IFRS Accounting Standards as issued by the IASB for each of the three years ended December 31, 2025 to the operating profit as presented in the consolidated statements of income prepared in accordance with K-IFRS.


	For the Year Ended December 31,
	2025			2024			2023
	(In billions of Won)
Operating profit pursuant to IFRS Accounting Standards as issued by the IASB	W	1,048.5		W	1,690.9		W	1,756.3
Differences:
Other income pursuant to IFRS Accounting Standards as issued by the IASB that are classified as other non-operating income pursuant to K-IFRS:
Gain on disposal of property and equipment and intangible assets		(127.1	)		(37.3	)		(21.9	)
Others		(43.3	)		(35.0	)		(28.5	)

		(170.4	)		(72.3	)		(50.4	)
Other operating expenses pursuant to IFRS Accounting Standards as issued by the IASB that are classified as other non-operating expenses pursuant to K-IFRS:
Impairment loss on property and equipment and intangible assets		3.1			94.7			10.4
Impairment loss on assets held for sale		12.3			—			—
Loss on disposal of property and equipment and intangible assets		15.3			17.4			9.4
Donations		15.3			15.7			14.8
Bad debt for accounts receivable – other		3.3			4.8			5.3
Others		145.8			72.2			7.5

		195.1			204.8			47.3

Operating profit pursuant to K-IFRS	W	1,073.2		W	1,823.4		W	1,753.2

See note 4(2) of the notes to our consolidated financial statements. However, there is no impact on profit for the year or earnings per share for each of the three years ended December 31, 2025, 2024 and 2023.

Operating Results

The following table sets forth summary consolidated statement of income information, including that expressed as a percentage of operating revenue and other income, for the periods indicated:


	For the year ended December 31,
	2025					2024				2023
	(In billions of Won, except percentages)
Operating revenue and other income	W	17,269.6		100.0	%	W	18,012.9	100.0	%	W	17,658.9	100.0	%
Revenue		17,099.2		99.0			17,940.6	99.6			17,608.5	99.7
Other income		170.4		1.0			72.3	0.4			50.4	0.3
Operating expenses		16,221.1		93.9			16,322.0	90.6			15,902.6	90.1
Operating profit		1,048.5		6.1			1,690.9	9.4			1,756.3	9.9
Profit before income tax		722.3		4.2			1,761.8	9.8			1,488.2	8.4
Income tax expense		347.2		2.0			374.7	2.1			342.2	1.9

Profit for the year		375.1		2.2			1,387.1	7.7			1,145.9	6.5
Attributable to:
Owners of the Parent Company		408.4		2.4			1,250.2	6.9			1,093.6	6.2
Non-controlling interests		(33.3	)	(0.2	)		136.9	0.8			52.3	0.3

The following table sets forth additional information about our operations with respect to our reportable segments during the periods indicated:


	For the year ended December 31,
	2025					2024					2023
	Amount		Percentage of Total Revenue			Amount		Percentage of Total Revenue			Amount		Percentage of Total Revenue
	(In billions of Won, except percentages)
Cellular Services Revenue
Wireless Service⁽¹⁾	W	9,715.6		56.8	%	W	10,401.6		58.0	%	W	10,329.0		58.7	%
Cellular Interconnection		369.9		2.2			400.5		2.2			432.7		2.5
Wireless Device Sales		1,034.7		6.1			1,078.7		6.0			993.9		5.6
Miscellaneous⁽²⁾		1,432.3		8.4			1,437.4		8.0			1,367.6		7.8

Total Cellular Services Revenue		12,552.5		73.4			13,318.2		74.2			13,123.2		74.5

Fixed-line Telecommunication Services Revenue
Fixed-line Telephone Service		142.5		0.8			156.5		0.9			147.7		0.8
Fixed-line Interconnection		12.4		0.1			14.0		0.1			15.8		0.1
Broadband Internet Service and Advanced Media Platform Service⁽³⁾		2,508.1		14.7			2,510.3		14.0			2,494.0		14.2
International Calling Service		200.9		1.2			213.7		1.2			190.9		1.1
Miscellaneous⁽⁴⁾		1,327.2		7.8			1,180.9		6.6			1,079.6		6.1

Total Fixed-line Telecommunication Services Revenue		4,191.1		24.5			4,075.4		22.7			3,928.0		22.3

Others Revenue
T-commerce⁽⁵⁾		312.9		1.8			302.3		1.7			301.3		1.7
Portal Service⁽⁶⁾		—		—			21.3		0.1			23.2		0.1
Miscellaneous⁽⁷⁾		42.7		0.2			223.4		1.2			232.8		1.3

Total Others Revenue		355.6		2.1			547.0		3.0			557.3		3.2

Total Revenue		17,099.2		100.0			17,940.6		100.0			17,608.5		100.0


	For the year ended December 31,
	2025						2024						2023
	Amount			Percentage of Total Revenue			Amount			Percentage of Total Revenue			Amount			Percentage of Total Revenue
	(In billions of Won, except percentages)
Segment Operating Expenses⁽⁸⁾
Cellular Services		11,808.3			69.1			11,746.3			65.5			11,673.1			66.3
Fixed-line Telecommunication Services		3,834.8			22.4			3,754.7			20.9			3,582.1			20.3
Others		382.9			2.2			616.2			3.4			600.1			3.4

Total Segment Operating Expenses		16,026.0			93.7			16,117.2			89.8			15,855.3			90.0

Segment Operating Profit (Loss)⁽⁹⁾
Cellular Services		744.2			4.4			1,571.9			8.8			1,450.1			8.2
Fixed-line Telecommunication Services		356.3			2.1			320.7			1.8			345.9			2.0
Others		(27.3	)		(0.2	)		(69.2	)		(0.4	)		(42.8	)		(0.2	)

Total Segment Operating Profit	W	1,073.2			6.3	%	W	1,823.4			10.2	%	W	1,753.2			10.0	%

(1)

Wireless service revenue includes revenue from wireless voice and data transmission services principally derived through monthly plan-based fees, usage charges for outgoing voice calls, usage charges for wireless data services and value-added service fees such as fees for T Universe subscription program paid by wireless subscribers.

(2)	Miscellaneous cellular services revenue includes revenue from our IoT and other solutions as well as other miscellaneous cellular services.

(3)	Broadband internet service and advanced media platform service revenue includes revenues from our broadband Internet services as well as IPTV and cable TV services.

(4)	Miscellaneous fixed-line telecommunication services revenue includes revenues from business communications and related infrastructure services (other than fixed-line telephone service) provided by SK Broadband.

(5)

T-commerce services revenue includes revenues from SK Stoa. In December 2025, we entered into an agreement to sell our entire equity stake in SK Stoa and Media S to Rapport Labs Inc., a Korea-based e-commerce company. Such transaction is currently pending subject to regulatory approval and other customary closing conditions, and the assets and liabilities of SK Stoa and Media S are classified as assets and liabilities held for sale in our consolidated financial statements included in this annual report. See “— Overview — Operational Efficiency.”

(6)	Portal service revenue includes revenues from our former subsidiary NATE Communications Corporation. See “— Overview — Operational Efficiency.”

(7)	Miscellaneous revenue includes revenues from our former indirect subsidiary SK M&Service and other minor miscellaneous revenue items. See “— Overview — Operational Efficiency.”

(8)

“Segment operating expenses” mean operating expenses for each reportable segment presented in accordance with K-IFRS and therefore does not include certain expenses that are classified as other non-operating expenses under K-IFRS. For more information on the differences between our consolidated operating expenses pursuant to K-IFRS and pursuant to IFRS Accounting Standards as issued by the IASB, see “— Explanatory Note Regarding Presentation of Certain Financial Information under K-IFRS.” Segment operating expenses presented above, which represent the difference between segment revenue and segment operating profit (loss), are not separately reviewed by or reported to our chief operating decision maker.

(9)

Segment operating profit (loss) for each of the segments above is presented net of consolidation adjustments. Accordingly, they do not reconcile with the segment operating profit (loss) for each of such segments set forth in note 4(1) of the notes to our consolidated financial statements, which is expressed prior to making such consolidation adjustments.

2025 Compared to 2024

Operating Revenue and Other Income. Our consolidated operating revenue and other income decreased by 4.1% to Won 17,269.6 billion in 2025 from Won 18,012.9 billion, due to a decrease in operating revenue, offset in small part by an increase in other income, as discussed below.

Our consolidated operating revenue decreased by 4.7% to Won 17,099.2 billion in 2025 from Won 17,940.6 billion in 2024, due to decreases in cellular services revenue and others revenue, which were partially offset by an increase in fixed-line telecommunications services revenue.

Our consolidated other income increased by 135.7% to Won 170.4 billion in 2025 from Won 72.3 billion in 2024, primarily due to the gain on disposal of property and equipment and intangible assets we recognized in 2025 relating to the disposal of our Pangyo office building.

The following sets forth additional information about our operating revenues with respect to each of our reportable segments.

•

Cellular services: The revenue of our cellular services segment, which is composed of revenues from wireless service, cellular interconnection, wireless device sales and miscellaneous cellular services, decreased by 5.7% to Won 12,552.5 billion in 2025 from Won 13,318.2 billion in 2024. The decrease in our cellular services revenue was mainly due to a decrease in wireless service revenue, which was enhanced by decreases in wireless device sales revenue and cellular interconnection revenue.

Wireless service revenue decreased by 6.6% to Won 9,715.6 billion in 2025 from Won 10,401.6 billion in 2024, primarily attributable to discounts on monthly subscription fees we offered for the month of August 2025 as part of the Customer Appreciation Package following the cybersecurity incident of which we became aware in April 2025 as described above. See “— Overview — Cybersecurity.”

Wireless device sales revenue decreased by 4.1% to Won 1,034.7 billion in 2025 from Won 1,078.7 billion in 2024, primarily due to the decrease in the sales volume of the handsets we sold during the year, which was also mainly attributable to the cybersecurity incident described above. See “— Overview — Cybersecurity.”

Cellular interconnection revenue decreased by 7.6% to Won 369.9 billion in 2025 from Won 400.5 billion in 2024, primarily attributable to a decrease in interconnection rates.

•

Fixed-line telecommunications services: The revenue of our fixed-line telecommunication services segment, which is composed of revenues from broadband Internet service and advanced media platform service (including IPTV and cable TV services), fixed-line telephone service, international calling service, fixed-line interconnection and miscellaneous fixed-line telecommunication services, increased by 2.8% to Won 4,191.1 billion in 2025 from Won 4,075.4 billion in 2024, due to an increase in miscellaneous fixed-line telecommunication services revenue, offset in part by decreases in fixed-line telephone service revenue and international calling service revenue.

Miscellaneous fixed-line telecommunication services revenue increased by 12.4% to Won 1,327.2 billion in 2025 from Won 1,180.9 billion in 2024, primarily due to an increase in revenue from our business communications and related infrastructure services, including our data center services.

Fixed-line telephone service revenue decreased by 8.9% to Won 142.5 billion in 2025 from Won 156.5 billion in 2024, primarily due to a decrease in the number of fixed-line telephone subscribers to 3.3 million as of December 31, 2025 from 3.4 million as of December 31, 2024.

International calling service revenue decreased by 6.0% to Won 200.9 billion in 2025 from Won 213.7 billion in 2024, primarily due to a decrease in international calling volume.

•

Others: The revenue of our others segment decreased by 35.0% to Won 355.6 billion in 2025 from Won 547.0 billion in 2024, primarily due to an 80.9% decrease in our miscellaneous others revenue to Won 42.7 billion in 2025 from Won 223.4 billion in 2024, which mainly reflected the disposal of our former subsidiary SK M&Service in February 2025, and no recognized revenue from our portal service business in 2025 compared to Won 21.3 billion in 2024, which reflected the disposal of our former subsidiary NATE Communications Corporation in January 2025. See “— Overview — Operational Efficiency.” Such decreases were slightly offset by a 3.5% increase in the revenue of SK Stoa’s T-commerce business to Won 312.9 billion in 2025 from Won 302.3 billion in 2024, which mainly reflected an increase in the gross value of merchandise sold.

Operating Expenses. Our consolidated operating expenses decreased by 0.6% to Won 16,221.1 billion in 2025 from Won 16,322.0 billion in 2024, primarily due to a 2.6% decrease in depreciation and amortization expenses to Won 3,467.1 billion in 2025 from Won 3,560.4 billion in 2024, a 1.3% decrease in commission expenses to Won 5,494.7 billion in 2025 from Won 5,564.3 billion in 2024, an 8.3% decrease in network interconnection expenses to Won 635.1 billion in 2025 from Won 692.9 billion in 2024 and a 4.3% decrease in cost of goods sold to Won 1,269.5 billion in 2025 from Won 1,326.2 billion in 2024, partially offset by a 10.5% increase in other operating expenses to Won 2,059.3 billion in 2025 from Won 1,864.0 billion in 2024.

The decrease in depreciation and amortization expenses was primarily related to a decrease in acquisitions of property and equipment, a decrease in the amortization expenses for our frequency usage rights, as well as the expiration of the applicable amortization period for certain of our software assets.

The decrease in commission expenses was primarily due to the expiration of the amortization period for capitalized commissions from prior years.

The decrease in network interconnection expenses was primarily due to decreases in wireless-to-fixed-line and fixed-line-to-wireless interconnection rates.

The decrease in cost of goods sold was primarily due to a decrease in the number of wireless devices sold in 2025.

The increase in other operating expenses was primarily due to the USIM replacement fees incurred in connection with the cybersecurity incident described above. See “— Overview — Cybersecurity.”

The following sets forth additional information about our segment operating expenses with respect to each of our reportable segments, which do not include certain expenses that are classified as other non-operating expenses under K-IFRS. For more information on the difference between our consolidated operating expenses pursuant to K-IFRS and pursuant to IFRS Accounting Standards as issued by the IASB, see “— Explanatory Note Regarding Presentation of Certain Financial Information under K-IFRS” and note 4(2) of the notes to our consolidated financial statements.

•

Cellular services: The segment operating expenses for our cellular services segment increased by 0.5% to Won 11,808.3 billion in 2025 from Won 11,746.3 billion in 2024, primarily due to the USIM replacement fees incurred in connection with the cybersecurity incident described above. See “— Overview — Cybersecurity.”

•

Fixed-line telecommunication services: The segment operating expenses for our fixed-line telecommunication services segment increased by 2.1% to Won 3,834.8 billion in 2025 from Won 3,754.7 billion in 2024, primarily due to an increase in SK Broadband’s labor costs, which in turn primarily reflected the one-time costs of engaging in a voluntary retirement program and higher wage levels, as well as an increase in depreciation expense in connection with its acquisition of the business operations of the Pangyo Data Center from SK Inc.

•

Others: The segment operating expenses for our others segment decreased by 37.9% to Won 382.9 billion in 2025 from Won 616.2 billion in 2024, primarily reflecting the disposals of our former subsidiaries NATE Communications Corporation and SK M&Service in January 2025 and February 2025, respectively.

Operating Profit. Our consolidated operating profit significantly decreased by 38.0% to Won 1,048.5 billion in 2025 from Won 1,690.9 billion in 2024, as the decrease in operating revenue and other income outpaced the decrease in operating expenses in 2025.

The following sets forth additional information about our segment operating profit (loss) with respect to each of our reportable segments. Our segment operating profit (loss) with respect to each of our reportable segments is based on K-IFRS and the sum of segment operating profit for all three reportable segments differs from our consolidated operating profit presented in accordance with IFRS Accounting Standards as issued by the IASB. For a reconciliation of operating profit presented in accordance with IFRS Accounting Standards as issued by the IASB and operating profit presented in accordance with K-IFRS, see “— Explanatory Note Regarding Presentation of Certain Financial Information under K-IFRS” and note 4(2) of the notes to our consolidated financial statements.

•

Cellular services: The segment operating profit of our cellular services segment decreased by 52.7% to Won 744.2 billion in 2025 from Won 1,571.9 billion in 2024, due to the greater decrease in segment operating revenue as compared to the decrease in segment operating expenses, for the various reasons described above. The segment operating margin (which, with respect to each reportable segment, is segment operating profit (loss) divided by revenue from such segment, expressed as a percentage) of our cellular services segment decreased to 5.9% in 2025 from 11.8% in 2024.

•

Fixed-line telecommunication services: The segment operating profit of our fixed-line telecommunication services segment increased by 11.1% to Won 356.3 billion in 2025 from Won 320.7 billion in 2024, due to the greater increase in segment operating revenue as compared to the increase in segment operating expenses, for the reasons described above. The segment operating margin of our fixed-line telecommunication services segment increased to 8.5% in 2025 from 7.9% in 2024.

•

Others: The segment operating loss of our others segment decreased by 60.5% to Won 27.3 billion in 2025 from Won 69.2 billion in 2024, due to the greater decrease in segment operating expenses as compared to the decrease in segment operating revenue as described above. The segment operating margin of our others segment improved to (7.7)% in 2025 from (12.7)% in 2024.

Finance Income and Finance Costs. Our finance income decreased by 38.2% to Won 219.4 billion in 2025 from Won 355.0 billion in 2024, primarily due to a 69.4% decrease in gain relating to financial instruments at fair value through profit or loss to Won 58.3 billion in 2025 from Won 190.4 billion in 2024, primarily reflecting the base effect of gain on derivatives recognized in 2024 in connection with our acquisition of additional equity interest in SK Broadband.

Our finance costs decreased by 20.4% to Won 482.0 billion in 2025 from Won 605.9 billion in 2024, primarily due to a significant decrease in loss relating to financial instruments at fair value through profit or loss to Won 16.4 billion in 2025 from Won 133.0 billion in 2024, primarily reflecting the significantly higher loss recognized in 2024 in connection with a forward transaction related to our investment in Penguin Solutions Inc.

Gains (Losses) Related to Investments in Subsidiaries, Associates and Joint Ventures. We recorded losses related to investments in subsidiaries, associates and joint ventures of Won 63.6 billion in 2025, primarily due to our share of loss from Rebellions, Inc. (formerly known as SAPEON Korea Inc.) of Won 77.6 billion, compared to gains related to investments in subsidiaries, associates and joint ventures of Won 321.8 billion in 2024, primarily in connection with the one-time effect of reclassification of our equity interest in SAPEON Korea Inc. from a consolidated subsidiary to an associate, following its merger with and into Rebellions, Inc. in 2024.

Income Tax. Income tax expense decreased by 7.3% to Won 347.2 billion in 2025 from Won 374.7 billion in 2024 primarily due to a 59.0% decrease in profit before income tax to Won 722.3 billion in 2025 from Won 1,761.8 billion in 2024. Such decrease was partially offset by income tax paid and other of Won 111.8 billion in 2025 compared to income tax refund and other of Won 18.3 billion in 2024. Our effective tax rate in 2025 increased to 48.1% from 21.3% in 2024. Our effective tax rate in 2025 was greater than the maximum statutory tax rate of 26.4%, primarily due to additional income tax resulting from a change in the tax authority’s interpretation. Our effective tax rate in 2024 was lower than the maximum statutory tax rate of 26.4%, primarily due to changes in unrecognized deferred taxes as well as tax credits and tax reductions.

Profit for the Year. Principally as a result of the factors discussed above, our profit for the year decreased by 73.0% to Won 375.1 billion in 2025 from Won 1,387.1 billion in 2024. Profit for the year as a percentage of operating revenue and other income was 2.2% in 2025 compared to 7.7% in 2024.

2024 Compared to 2023

Operating Revenue and Other Income. Our consolidated operating revenue and other income increased by 2.0% to Won 18,012.9 billion in 2024 from Won 17,658.9 billion in 2023 due to increases in operating revenue and, to a much lesser extent, other income, as discussed below.

Our consolidated operating revenue increased by 1.9% to Won 17,940.6 billion in 2024 from Won 17,608.5 billion in 2023, due to increases in cellular services revenue and fixed-line telecommunications services revenue, which were slightly offset by a decrease in others revenue.

Our consolidated other income increased by 43.5% to Won 72.3 billion in 2024 from Won 50.4 billion in 2023, primarily due to the gain on disposal of property and equipment and intangible assets we recognized in 2024 relating to certain ancillary properties.

The following sets forth additional information about our operating revenues with respect to each of our reportable segments.

•

Cellular services: The revenue of our cellular services segment, which is composed of revenues from wireless service, cellular interconnection, wireless device sales and miscellaneous cellular services, increased by 1.5% to Won 13,318.2 billion in 2024 from Won 13,123.2 billion in 2023. The increase in our cellular services revenue was due to increases in wireless device sales revenue, wireless service revenue and miscellaneous cellular services revenue, partially offset by a decrease in cellular interconnection revenue.

Wireless device sales revenue increased by 8.5% to Won 1,078.7 billion in 2024 from Won 993.9 billion in 2023, primarily due to increases in the sales volume and average prices of the handsets we sold during the year, which primarily reflected the launch of new high-end flagship devices by leading manufacturers and higher prices charged by such manufacturers.

Wireless service revenue increased by 0.7% to Won 10,401.6 billion in 2024 from Won 10,329.0 billion in 2023, primarily attributable to the continued increase in the number of subscribers who subscribe to our 5G subscription plans and an increase in the usage of our roaming services in light of a further increase in international travel by our subscribers.

Miscellaneous cellular services revenue increased by 5.1% to Won 1,437.4 billion in 2024 from Won 1,367.6 billion in 2023, primarily due to increases in revenue from our cloud services, IoT solutions and other new businesses, as we continued to build up the scale of such businesses to complement our core wireless service business.

Cellular interconnection revenue decreased by 7.4% to Won 400.5 billion in 2024 from Won 432.7 billion in 2023, primarily attributable to a decrease in interconnection rates.

•

Fixed-line telecommunications services: The revenue of our fixed-line telecommunication services segment, which is composed of revenues from broadband Internet service and advanced media platform service (including IPTV and cable TV services), fixed-line telephone service, international calling service, fixed-line interconnection and miscellaneous fixed-line telecommunication services, increased by 3.8% to Won 4,075.4 billion in 2024 from Won 3,928.0 billion in 2023, primarily due to increases in miscellaneous fixed-line telecommunication services revenue, and to a lesser extent, international calling service revenue, broadband Internet service and advanced media platform service revenue, and fixed-line telephone service revenue, slightly offset by a decrease in fixed-line interconnection revenue.

Miscellaneous fixed-line telecommunication services revenue increased by 9.4% to Won 1,180.9 billion in 2024 from Won 1,079.6 billion in 2023, primarily due to an increase in revenue from our business communications and related infrastructure services, including our data center services.

International calling service revenue increased by 11.9% to Won 213.7 billion in 2024 from Won 190.9 billion in 2023, primarily due to an increase in international calling volume.

Revenue from our broadband Internet service and advanced media platform service (including our IPTV and cable TV services) slightly increased by 0.7% to Won 2,510.3 billion in 2024 from Won 2,494.0 billion in 2023, primarily due to an increase in the number of IPTV subscribers to 6.8 million subscribers as of December 31, 2024 from 6.7 million subscribers as of December 31, 2023.

Fixed-line telephone service revenue increased by 6.0% to Won 156.5 billion in 2024 from Won 147.7 billion in 2023, primarily due to an increase in calling volume, including those relating to the National Assembly election campaigns in 2024.

Fixed-line interconnection revenue decreased by 11.4% to Won 14.0 billion in 2024 from Won 15.8 billion in 2023, primarily due to a continued decrease in interconnection rates, as well as decreases in residential calling volume and the number of fixed-line telephone subscribers to 3.4 million as of December 31, 2024 from 3.5 million as of December 31, 2023.

•

Others: The revenue of our others segment slightly decreased by 1.8% to Won 547.0 billion in 2024 from Won 557.3 billion in 2023, primarily due to a 4.1% decrease in our miscellaneous others revenue, which mainly reflected a decrease in revenue we derived from our former subsidiary SK M&Service, and an 8.2% decrease in our portal service revenue derived from our former subsidiary NATE Communications Corporation. Such decreases were partially offset by a 0.3% increase in the revenue of SK Stoa’s T-commerce business to Won 302.3 billion in 2024 from Won 301.3 billion in 2023, which mainly reflected an increase in the gross value of merchandise sold.

Operating Expenses. Our consolidated operating expenses increased by 2.6% to Won 16,322.0 billion in 2024 from Won 15,902.6 billion in 2023, primarily due to a 9.5% increase in labor costs to Won 2,725.8 billion in 2024 from Won 2,488.2 billion in 2023, a 12.9% increase in other operating expenses to Won 1,864.0 billion in 2024 from Won 1,651.3 billion in 2023 and a 4.7% increase in cost of goods sold to Won 1,326.2 billion in 2024 from Won 1,266.4 billion in 2023, partially offset by a 1.5% decrease in depreciation and amortization expenses to Won 3,560.4 billion in 2024 from Won 3,614.8 billion in 2023 and a 21.0% decrease in advertising expenses to Won 186.3 billion in 2024 from Won 235.8 billion in 2023.

The increase in labor costs was primarily due to our one-time implementation of a voluntary retirement program and a general increase in the base salary of our employees.

The increase in other operating expenses was primarily due to an increase in impairment loss on property and equipment and intangible assets related to the replacement of outdated equipment and our recognition of the expected amount of certain administrative fine of Won 42.6 billion, which was provisionally announced by the

KFTC in March 2025 (see “Item 8.A. — Consolidated Statements and Other Financial Information — Legal Proceedings — KFTC Proceedings”), as well as an increase in utilities, mainly reflecting an increase in electricity prices.

The increase in cost of goods sold was primarily due to increases in sales of merchandise under our T Universe subscription program and solutions businesses to our enterprise customers.

The decrease in depreciation and amortization expenses was primarily related to the expiration of the applicable amortization period for certain of our software assets and a decrease in the amortization expenses for our frequency usage rights, as well as a decrease in acquisitions of property and equipment.

The decrease in advertising expenses was primarily due to continued stabilization of the market for wireless service subscribers and our efficient management of marketing fees as part of our ongoing organizational efforts to enhance operational efficiency, as well as the base effect of our extensive advertising campaigns in 2023 as part of our efforts to promote the City of Busan’s bid to host the World Expo 2030.

•

Cellular services: The segment operating expenses for our cellular services segment slightly increased by 0.6% to Won 11,746.3 billion in 2024 from Won 11,673.1 billion in 2023, due to the increase in SK Telecom’s labor costs as described above, which was substantially offset by a decrease in commissions paid to SK Telecom’s authorized dealers and independent retailers, as the market for new 5G subscribers continued to stabilize, and a decrease in depreciation and amortization expenses, primarily reflecting the expiration of the applicable amortization period for certain of our software assets and a decrease in the amortization expenses for our frequency usage rights, as well as a decrease in acquisitions of property and equipment.

•

Fixed-line telecommunication services: The segment operating expenses for our fixed-line telecommunication services segment increased by 4.8% to Won 3,754.7 billion in 2024 from Won 3,582.1 billion in 2023, primarily due to increases in SK Broadband’s labor costs, primarily reflecting higher wage levels and associated retirement benefits, as well as in marketing expenses and commissions, primarily reflecting increases in the sale of broadband Internet and IPTV service subscriptions.

•

Others: The segment operating expenses for our others segment increased by 2.7% to Won 616.2 billion in 2024 from Won 600.1 billion in 2023, primarily due to increases in utilities and costs of goods sold as well as labor costs.

Operating Profit. Our consolidated operating profit decreased by 3.7% to Won 1,690.9 billion in 2024 from Won 1,756.3 billion in 2023, as the increase in operating expenses outpaced the increase in operating revenue and other income in 2024.

Presentation of Certain Financial Information under K-IFRS” and note 4(2) of the notes to our consolidated financial statements.

•

Cellular services: The segment operating profit of our cellular services segment increased by 8.4% to Won 1,571.9 billion in 2024 from Won 1,450.1 billion in 2023, due to the greater increase in segment operating revenue as compared to the increase in segment operating expenses, for the various reasons described above. The segment operating margin (which, with respect to each reportable segment, is segment operating profit (loss) divided by revenue from such segment, expressed as a percentage) of our cellular services segment increased to 11.8% in 2024 from 11.0% in 2023.

•

Fixed-line telecommunication services: The segment operating profit of our fixed-line telecommunication services segment decreased by 7.3% to Won 320.7 billion in 2024 from Won 345.9 billion in 2023, due to the greater increase in segment operating expenses as compared to the increase in segment operating revenue, for the reasons described above. The segment operating margin of our fixed-line telecommunication services segment decreased to 7.9% in 2024 from 8.8% in 2023.

•

Others: The segment operating loss of our others segment increased by 61.7% to Won 69.2 billion in 2024 from Won 42.8 billion in 2023, due to the increase in segment operating expenses as compared to the decrease in segment operating revenue as described above. As a result, the segment operating margin of our others segment worsened to (12.7)% in 2024 from (7.7)% in 2023.

Finance Income and Finance Costs. Our finance income increased by 42.9% to Won 355.0 billion in 2024 from Won 248.4 billion in 2023, primarily due to a 65.6% increase in gain relating to financial instruments at fair value through profit or loss to Won 190.4 billion in 2024 from Won 115.0 billion in 2023, primarily relating to gain on derivatives recognized in connection with our acquisition of additional equity interest in SK Broadband. The effect of such increase was enhanced by a 24.4% increase in interest income to Won 87.2 billion in 2024 from 70.1 billion in 2023, which mainly reflected an increase in the average volume of our interest-earning financial assets.

Our finance costs increased by 14.9% to Won 605.9 billion in 2024 from Won 527.4 billion in 2023, primarily due to a significant increase in loss relating to financial instruments at fair value through profit or loss to Won 133.0 billion in 2024 from Won 49.6 billion in 2023, primarily relating to forward transaction loss from our investment in Penguin Solutions Inc. The effect of such increase was enhanced by a 3.4% increase in interest expense to Won 403.1 billion in 2024 from Won 389.8 billion in 2023, which mainly reflected our refinancing of maturing debt at higher interest rates in recent years, as the market interest rates were generally higher in more recent periods compared to earlier periods over the past few years. The impact of such increases was partially offset by a decrease in loss on sale of accounts receivable – other related to our sale of accounts receivable for handset installment payments to Won 35.3 billion in 2024 from Won 65.0 billion in 2023.

Gains Related to Investments in Subsidiaries, Associates and Joint Ventures. Gains related to investments in subsidiaries, associates and joint ventures significantly increased to Won 321.8 billion in 2024 from Won 10.9 billion in 2023, primarily due to the reclassification of our equity interest in SAPEON Korea Inc. from a consolidated subsidiary to an associate, following its merger with and into Rebellions, Inc. during 2024.

Income Tax. Income tax expense increased by 9.5% to Won 374.7 billion in 2024 from Won 342.2 billion in 2023 primarily due to an 18.4% increase in profit before income tax to Won 1,761.8 billion in 2024 from Won 1,488.2 billion in 2023. Our effective tax rate in 2024 decreased to 21.3% from 23.0% in 2023. Our effective tax rates in 2024 and 2023 were lower than the maximum statutory tax rate of 26.4% for both years, primarily due to, in the case of 2024, changes in unrecognized deferred taxes as well as tax credits and tax reductions, and in the case of 2023, tax credits and tax reductions.

Profit for the Year. Principally as a result of the factors discussed above, our profit for the year increased by 21.0% to Won 1,387.1 billion in 2024 from Won 1,145.9 billion in 2023. Profit for the year as a percentage of operating revenue and other income was 7.7% in 2024 compared to 6.5% in 2023.

Item 5.B.

Liquidity and Capital Resources

Liquidity

We had a working capital surplus (current assets in excess of current liabilities) of Won 197.4 billion as of December 31, 2025, a working capital deficit (current liabilities in excess of current assets) of Won 1,747.6 billion as of December 31, 2024 and a working capital deficit of Won 408.4 billion as of December 31, 2023. The increase in our working capital as of December 31, 2025 compared to December 31, 2024 was mainly due to a decrease in our current liabilities, primarily in relation to current portion of long-term debt, net and accounts payable – other, which outpaced the decrease in our current assets, primarily in relation to cash and cash equivalents. We plan to fund our current liabilities with the cash flow generated by our operations, proceeds from the disposal of investment securities or property and equipment that are no longer deemed profitable and proceeds from additional borrowings, as necessary.

We had cash and cash equivalents, short-term financial instruments and short-term investment securities of Won 1,676.7 billion as of December 31, 2025, Won 2,347.6 billion as of December 31, 2024 and Won 1,749.9 billion as of December 31, 2023. We had outstanding short term borrowings and current portion of long-term debt of Won 1,252.6 billion as of December 31, 2025, Won 2,560.1 billion as of December 31, 2024 and Won 1,621.8 billion as of December 31, 2023. As of December 31, 2025, SK Telecom had credit lines with several local banks that provided for borrowing of up to Won 1,050 billion, all of which was available for borrowing.

Cash flows from operating activities and debt financing have been our principal sources of liquidity. We had cash and cash equivalents of Won 1,490.0 billion as of December 31, 2025, Won 2,023.7 billion as of December 31, 2024 and Won 1,455.0 billion as of December 31, 2023. We believe that we have a variety of alternatives available to us to satisfy our financial requirements to the extent that they are not met by funds generated by operations, including the issuance of debt securities and bank borrowings.


	Year ended December 31,									Change
	2025			2024			2023			2024 to 2025					2023 to 2024
	(In billions of Won, except percentages)
Net cash provided by operating activities	W	3,923.8		W	5,087.3		W	4,947.2		W	(1,163.5	)	(22.9	)%	W	140.1		2.8	%
Net cash used in investing activities		(1,737.1	)		(2,711.8	)		(3,352.9	)		974.7		(35.9	)		641.1		(19.1	)
Net cash used in financing activities		(2,711.8	)		(1,809.9	)		(2,021.0	)		(901.9	)	49.8			211.1		(10.4	)
Net increase (decrease) in cash and cash equivalents		(525.0	)		565.6			(426.7	)		(1,090.6	)	N.A.			992.3		N.A.
Effect of exchange rate changes on cash and cash equivalents		(4.1	)		26.1			(0.6	)		(30.2	)	N.A.			26.7		N.A.
Cash and cash equivalents included in assets held for sale		(4.6	)		(23.0	)		—			18.4		(80.0	)		(23.0	)	N.A.
Cash and cash equivalents at beginning of period		2,023.7			1,455.0			1,882.3			568.7		39.1			(427.3	)	(22.7	)
Cash and cash equivalents at end of period		1,490.0			2,023.7			1,455.0			(533.7	)	(26.4	)		568.7		39.1

N.A. = Not available

Cash Flows from Operating Activities. Net cash provided by operating activities was Won 3,923.8 billion in 2025, Won 5,087.3 billion in 2024 and Won 4,947.2 billion in 2023. Profit for the year was Won 375.1 billion in

2025, Won 1,387.1 billion in 2024 and Won 1,145.9 billion in 2023. Net cash provided by operating activities in 2025 decreased by 22.9% from 2024, primarily due to the decrease in profit for the year as well as an increase in prepaid expenses (mainly reflecting an increase in contract acquisition costs capitalized as prepaid expenses) and a decrease in accrued expenses (mainly reflecting a decrease in employee incentives). Net cash provided by operating activities in 2024 increased by 2.8% from 2023, primarily due to the increase in profit for the year as well as increases in accrued expenses (mainly reflecting an increase in the outstanding year-end payables relating to our operating expenditures and our recognition of the expected amount of certain administrative fine announced by the KFTC in March 2025 as described above) and in withholdings (mainly reflecting an increase in our salary expenses) compared to decreases of such line items in 2023.

Cash Flows from Investing Activities. Net cash used in investing activities was Won 1,737.1 billion in 2025, Won 2,711.8 billion in 2024 and Won 3,352.9 billion in 2023. Cash inflows from investing activities were Won 1,384.3 billion in 2025, Won 362.3 billion in 2024 and Won 272.6 billion in 2023. Cash inflows in 2025 mainly reflected proceeds from disposals of long-term investment securities, primarily related to our disposals of shares of Kakao Corp. and Joby Aviation Inc., and proceeds from disposals of property and equipment, mainly related to the sale of an office building in Pangyo. Cash inflows in 2024 mainly reflected collection of short-term loans, primarily related to SK Telecom’s collection of short-term loans that were made to authorized dealers, and proceeds from disposals of investments in associates and joint ventures, mainly related to the reductions of paid-in capital by SK Technology Innovation Company and SK Latin America Investment S.A.

Cash outflows for investing activities were Won 3,121.4 billion in 2025, Won 3,074.1 billion in 2024 and Won 3,625.5 billion in 2023. Cash outflows in 2025, 2024 and 2023 were primarily attributable to expenditures related to the acquisition of property and equipment of Won 2,206.6 billion, Won 2,487.4 billion and Won 2,973.9 billion, respectively, primarily in connection with the acquisition of 5G and LTE equipment, the maintenance and enhancement of our 5G network and the maintenance of our LTE network.

Cash Flows from Financing Activities. Net cash used in financing activities was Won 2,711.8 billion in 2025, Won 1,809.9 billion in 2024 and Won 2,021.0 billion in 2023. Cash inflows from financing activities were Won 2,258.3 billion in 2025, Won 1,552.2 billion in 2024 and Won 2,416.8 billion in 2023. Such inflows were primarily driven by the issuance of debentures, which provided cash of Won 1,875.3 billion in 2025, Won 1,236.5 billion in 2024 and Won 1,785.1 billion in 2023, as well as proceeds from long-term borrowings, which provided cash of Won 300.0 billion in 2025, Won 200.0 billion in 2024 and Won 50.0 billion in 2023, and proceeds from issuance of hybrid bonds in the case of 2023, which provided cash of Won 398.5 billion.

Cash outflows for financing activities were Won 4,970.0 billion in 2025, Won 3,362.0 billion in 2024 and Won 4,437.8 billion in 2023. Cash outflows for financing activities included repayments of debentures, repayments of long-term borrowings, payments of dividends, repayments of long-term payables – other, repayments of lease liabilities and transactions with non-controlling shareholders, among other items. Repayments of debentures were Won 2,121.5 billion in 2025, Won 1,235.8 billion in 2024 and Won 1,869.2 billion in 2023. Repayments of long-term borrowings were Won 312.5 billion in 2025, Won 402.5 billion in 2024 and Won 125.0 billion in 2023. Payments of dividends were Won 628.4 billion in 2025, Won 804.3 billion in 2024 and Won 773.8 billion in 2023. Repayments of long-term payables – other were Won 369.2 billion in 2025, Won 369.2 billion in 2024 and Won 400.2 billion in 2023. Repayments of lease liabilities were Won 372.8 billion in 2025, Won 381.3 billion in 2024 and Won 402.5 billion in 2023. In addition, cash outflow from transactions with non-controlling shareholders was Won 1,145.9 billion in 2025, which mainly related to our acquisition of additional equity interest in SK Broadband from minority shareholders in May 2025.

As of December 31, 2025, we had total long-term debt (excluding current portion) outstanding of Won 7,594.4 billion, which included debentures in the amount of Won 7,294.4 billion and bank and institutional borrowings in the amount of Won 300.0 billion. As of December 31, 2024, we had total long-term debt (excluding current portion) outstanding of Won 6,566.7 billion, which included debentures in the amount of Won 6,363.6 billion and bank and institutional borrowings in the amount of Won 203.1 billion. For a description of our long-term debt, see note 17 of the notes to our consolidated financial statements.

As of December 31, 2025, we had (i) Won 6,802.0 billion aggregate principal amount of Korean Won-denominated debentures outstanding and (ii) Won 1,434.9 billion aggregate principal amount of debentures outstanding denominated in Dollars. The fixed interest rates of our debentures range from 1.39% to 6.63% depending on the offering size, maturity, interest rate environment at the time of the offering and currency, among other factors. We have a diversified maturity profile with respect to our debentures. See “— Contractual Obligations and Commitments” for more details.

As of December 31, 2025, substantially all of our foreign currency-denominated short term and long-term borrowings and debentures, which in the aggregate amounted to 16.2% of our total outstanding short-term and long-term debt, including the current portion and net of present value discount and discounts on bonds as of such date, was denominated in Dollars. However, substantially all of our revenue and operating expenses are denominated in Won. We generally pay for imported capital equipment in Dollars. Appreciation of the Won against the Dollar will result in net foreign currency transaction and translation gains, while depreciation of the Won against the Dollar will result in net foreign currency transaction and translation losses. Changes in foreign currency exchange rates will also affect our liquidity because of the effect of such changes on the amount of funds required for us to make interest and principal payments on our foreign currency-denominated debt. For a description of swap or derivative transactions we have entered into, among other transactions, to mitigate the effects of such losses, see “Item 11. Quantitative and Qualitative Disclosures about Market Risk.”

Capital Requirements

Historically, capital expenditures, repayment of outstanding debt, frequency usage payments and lease payments have represented our most significant use of funds. In recent years, we have also increasingly dedicated capital resources to develop and invest in innovative new solutions and services, including those utilizing our AI and digital infrastructure capabilities and our telecommunications platforms, as well as to make strategic investments in companies with innovative technology or other complementary offerings of solutions and services.

To fund our scheduled debt repayment and planned capital expenditures over the next several years, we intend to rely primarily on cash flows from operating activities, as well as bank and institutional borrowings, and offerings of debt or equity in the domestic or international markets. We believe that these sources will be sufficient to fund our planned capital expenditures for 2026. Our ability to rely on these alternatives could be affected by the liquidity of the Korean financial markets or by Government policies regarding Won and foreign currency borrowings and the issuance of equity and debt. Our failure to make needed expenditures would adversely affect our ability to sustain subscriber growth and provide quality services and, consequently, our results of operations.

Capital Expenditures. The following table sets forth our actual capital expenditures for 2025, 2024 and 2023:


	Year ended December 31,
	2025		2024		2023
	(In billions of Won)
Wireless Networks⁽¹⁾	W	733.9	W	1,259.0	W	1,380.6
Fixed-line Network⁽²⁾		885.4		850.2		999.5
Others⁽³⁾		587.3		378.2		593.8

Total	W	2,206.6	W	2,487.4	W	2,973.9

(1)	Includes investments in wireless networks, primarily our 5G, LTE and Wi-Fi networks, as well as other capital expenditures related to our networks.

(2)	Includes all capital expenditures made by SK Broadband.

(3)	Includes non-network related investments such as capital expenditures for product development, upgrades of our information technology systems and equipment and investments in data infrastructure.

We set our capital expenditure budget for each upcoming year on an annual basis. Our actual capital expenditures in 2025, 2024 and 2023 were Won 2,206.6 billion, Won 2,487.4 billion and Won 2,973.9 billion, respectively. Of such amounts, we spent approximately 33.3%, 50.6% and 46.4%, respectively, on capital expenditures related to building and enhancing our wireless networks. Our capital expenditures related to building and enhancing our wireless networks, including in connection with our 5G network which we launched in 2019, have generally decreased in recent years. See “Item 4.B. Business Overview — Cellular Services — Digital Wireless Network — 5G Network.” Our other non-network related capital expenditures in 2025, 2024 and 2023 primarily related to developing new products, services and technology, upgrades to our information technology systems and equipment and investments in data infrastructure.

In particular, we have been making capital expenditures to expand, and subsequently maintain and enhance, our 5G network. We commenced commercial 5G services in April 2019. We have also been making capital expenditures to enhance and maintain our LTE network. For a more detailed description of our 5G and LTE networks, see “Item 4.B. Business Overview — Cellular Services — Digital Wireless Network.” In addition, we have been making capital expenditures to maintain and enhance our fixed-line (including broadband Internet) networks. We plan to continue to make capital investments in 2026 to maintain and enhance our 5G, LTE and fixed-line networks and develop related technologies, as well as to maintain our LTE network.

The following table sets forth our payment obligations relating to our acquisitions of frequency usage rights.


Spectrum	Technology (width)	Date of Acquisition (including renewals)		Initial Payment Amount (in billions of Won)		Initial Payment Year		Annual Payment Amount (in billions of Won)		Annual Payment Term
800 MHz	LTE (20 MHz)		Jul. 2021	W	56.8		2021	W	34.1		2022-2026
1.8 GHz	LTE (20 MHz + 15 MHz)		Dec. 2021		136.9		2021		82.2		2022-2026
2.1 GHz	LTE (30 MHz)		Dec. 2021		102.9		2021		61.8		2022-2026
	WCDMA (10 MHz)
2.6 GHz	LTE (40 MHz + 20 MHz)		Aug. 2016		332.5		2016		99.8		2017-2026
3.5 GHz	5G (100 MHz)		Dec. 2018		304.6		2018		91.4		2019-2028

We currently expect to spend a slightly higher amount for capital expenditures in 2026 compared to 2025 for a range of projects, including investments to maintain and enhance our telecommunications networks (including our 5G and LTE networks), investments to improve and maintain our Wi-Fi network, investments in data infrastructure and computing capabilities, and investments in the development of AI, IoT and other digital solutions and services. In December 2025, the MSIT announced plans to reallocate a total of 370 MHz of frequency bandwidths whose usage terms are due to expire in 2026 to KT, LG U+ and us, 155 MHz (in the 800 MHz, 1.8 GHz, 2.1 GHz and 2.6 GHz spectrums) of which will be allocated to us. We have applied for the renewal of the 20 MHz frequency bandwidth in the 800 MHz spectrum in December 2025, and we plan to apply for the renewal of the remaining 135 MHz of frequency bandwidths in June 2026. The final consideration to be paid by us for such reallocated bandwidths is expected to be conditional on the number of indoor 5G cell sites to be constructed by us by 2031. However, our overall capital expenditure levels and the allocation of such expenditures remain subject to many uncertainties. We may increase, reduce or suspend our planned capital expenditures for 2026 or change the timing and area of our capital expenditure spending from the estimates described above in response to market conditions or for other reasons. We may also make additional capital expenditures and other investments beyond our currently anticipated level as opportunities arise, including in relation to any acquisitions of additional frequency usage rights or execution of additional AI-related investments. Accordingly, we periodically review the amount of our capital expenditures and other investments and may make adjustments based on the current progress of capital expenditure projects and market conditions. No assurance can be given that we will be able to meet any such increased expenditure requirements or obtain adequate financing for such requirements, on terms acceptable to us, or at all.

Repayment of Outstanding Debt. As of December 31, 2025, our principal repayment obligations with respect to long-term borrowings, bonds and short-term borrowings outstanding were as follows for the periods indicated:


Year Ending December 31,	Total
	(In billions of Won)
2026	W	1,255.1
2027		1,949.0
2028		2,020.9
2029 and thereafter		3,645.0

Lease Payments. Pursuant to IFRS 16, Leases, we recognize right-of-use assets representing our rights to use the underlying assets and lease liabilities representing our obligation to make lease payments in relation to substantially all of our lease arrangements, except for certain short-term leases and leases of low-value assets. As of December 31, 2025, our aggregate current and long-term lease liabilities amounted to Won 1,525.8 billion, which primarily related to land, buildings and structures we leased from third parties in the ordinary course of our business. As of December 31, 2025, our payment obligations with respect to our lease liabilities were as follows for the periods indicated:


Year Ending December 31,	Total
	(In billions of Won)
2026	W	420.1
2027		412.5
2028		265.5
2029 and thereafter		678.2

Investments in New Growth Businesses. We may also require capital for investments to support our development of new growth businesses, including, for example, investments in leading AI technology companies to facilitate mutual collaboration. Our notable strategic investments in other companies for such purpose in recent years include the following:

•

In June 2023, we made an equity investment of US$100 million in Joby Aviation Inc., a transportation company based in Santa Cruz, California, which is developing electric vertical take-off and landing aircrafts, as part of our ongoing efforts to develop emissions-free aerial ridesharing services to cities and communities across Korea.

•

In August 2023, we made an equity investment of US$100 million in Anthropic PBC, a generative AI technology company based in San Francisco, California, in order to jointly develop a multilanguage large-language model customized for telecommunications companies.

•

In February 2024, we made an equity investment of US$20 million in Lambda, Inc., a GPU cloud service provider based in San Francisco, California, in order to cooperate on the development and launch of GPUaaS and AI data center solutions and services.

•

In June 2024, we made an equity investment of US$10 million in Perplexity AI, Inc., an AI technology company based in San Francisco, California, in order to cooperate on the development of generative AI search engine services.

•

In December 2024, we made an equity investment of US$200 million in Penguin Solutions Inc., a leading designer and developer of enterprise solutions based in Milpitas, California, in order to cooperate on the development of differentiated global end-to-end AI factory and data center solutions and services.

To date, we have made more than US$300 million on a cumulative basis in AI-related investments, and we seek to continue making such and other investments in furtherance of our growth strategy. See “Item 4.B. Business Overview — Our Business Strategy.”

From time to time, we may make other investments in telecommunications or other businesses in Korea or abroad, where we perceive attractive opportunities for investment. From time to time, we may also dispose of existing investments when we believe that doing so would be in our best interest. See “— Overview — Operational Efficiency.”

Severance Payments. The present value of our defined benefit obligations, which is the present value of total accrued and unpaid retirement and severance benefits for our employees, as of December 31, 2025, was Won 1,051.5 billion, which was more than offset by the fair value of our defined benefit plan assets of Won 1,257.0 billion as of such date. Accordingly, we recognized defined benefit assets of Won 205.5 billion as of December 31, 2025. Also see “Item 6.D. Employees — Employee Benefits” and note 20 of the notes to our consolidated financial statements.

Dividends. Total cash outflows for payments of dividends amounted to Won 628.4 billion in 2025, Won 804.3 billion in 2024 and Won 773.8 billion in 2023.

Contractual Obligations and Commitments

The following summarizes our contractual cash obligations (excluding short-term leases and leases of low-value assets) at December 31, 2025, and the effect such obligations are expected to have on liquidity and cash flow in future periods:


	Payments Due by Period⁽¹⁾
	Total		Less Than 1 Year		1-3 Years		4-5 Years		More Than 5 Years
	(In billions of Won)
Bonds
Principal	W	8,236.9	W	922.0	W	3,669.9	W	1,795.0	W	1,850.0
Interest		1,089.6		277.3		388.7		168.6		255.1
Long-term borrowings
Principal		503.1		203.1		300.0		—		—
Interest		20.5		14.4		6.1		—		—
Lease liabilities		1,776.3		420.1		678.0		359.1		319.1
Facility deposits		10.7		5.0		—		—		5.7
Other long-term payables⁽²⁾
Principal		551.9		369.2		182.8		—		—
Interest		13.9		9.3		4.6		—		—
Short-term borrowings		130.0		130.0		—		—		—

Total contractual cash obligations	W	12,332.9	W	2,350.2	W	5,230.2	W	2,322.6	W	2,429.9

(1)

We are contractually obligated to make severance payments to eligible employees we have employed for more than one year, upon termination of their employment, regardless of whether such termination is voluntary or involuntary. Accruals for severance indemnities are recorded based on the amount we would be required to pay in the event the employment of all our employees were to terminate at the balance date. However, we have not yet estimated cash flows for future periods. Accordingly, payments due in connection with severance indemnities have been excluded from this table.

(2)	Related to acquisition of frequency licenses. See note 18 of the notes to our consolidated financial statements.

See note 36 of the notes to our consolidated financial statements for details related to our other commitments and contingencies.

Item 5.C.

Research and Development, Patents and Licenses, etc.

We maintain a high level of spending on our research and development activity. We also donate funds to several Korean research institutes and educational organizations that focus on research and development activity. We believe that we must maintain a substantial in-house technology capability to achieve our strategic goals.

The main focus of our research and development activity is the development of new wireless technologies and services and value-added technologies and services for our 5G network and LTE network, such as wireless data communications, as well as the development of new technologies that reflect the growing convergence between telecommunications and other industries, such as AI, big data analytics and media. SK Telecom’s research and development activity is primarily conducted through our SK AI Research and Development Center, which is subdivided into the Future Research and Development Laboratory, AI DC Laboratory, Open AIX Laboratory, Vision Laboratory, Media Laboratory, Digital Twin Laboratory and the AI Model Laboratory. The Infrastructure Technology Division of the Network Infrastructure Center also conducts related research and development activities.

Each business unit also has its own research team that can concentrate on specific short-term research needs, and some of our consolidated subsidiaries also have their own research and development organizations to focus on activities related to their respective business areas. Such research teams permit our research center to concentrate on long-term, technology-intensive research projects. We aim to establish strategic alliances with selected domestic and foreign companies with a view to exchanging or jointly developing technologies, products and services. See “Item 5.A. Operating Results — Overview — Operational Efficiency.”

Item 5.D.

Trend Information

These matters are discussed under “Item 5.A. Operating Results” and “Item 5.B. Liquidity and Capital Resources” above where relevant.

Item 5.E.

Critical Accounting Estimates

Our financial statements are prepared in accordance with IFRS Accounting Standards as issued by the IASB. See notes 2(4) and 3 of the notes to our consolidated financial statements which provide summaries of certain critical accounting estimates that require our management to make difficult, complex or subjective judgments relating to matters which are highly uncertain and that may have a material impact on our financial conditions and results of operations.

Item 6.

DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

Item 6.A.

Directors and Senior Management

Our board of directors has ultimate responsibility for the management of our affairs. Under our articles of incorporation, our board is to consist of at least three but no more than twelve directors, more than half of whom must be independent non-executive directors. We currently have a total of eight directors, five of whom are independent non-executive directors. We elect our directors at a general meeting of shareholders with the approval of at least a majority of those shares present or represented at such meeting. Such majority must represent at least one-fourth of our total issued and outstanding shares with voting rights.

As required under relevant Korean laws and our articles of incorporation, we have a committee for recommendation of independent non-executive directors within the board of directors, the Independent Director Nomination Committee. Independent non-executive directors are appointed from among those candidates recommended by the Independent Director Nomination Committee.

Our current non-executive directors are as set forth below:

Name

Month
and Year of
Birth

Director
Since

Expiration
of Term

Position

Other Positions

Business Experience

Poong Young Yoon

Nov. 1974

2026

2029

Non-executive
Director

President in
Charge, SUPEX
Council

President, SK AX; Chief Investment Officer, SK Square; Head of Corporate Center, SK Telecom

Chang Bo Kim

Jul. 1959

2025

2028

Independent
Non-executive
Director

Attorney, DR &
AJU LLC

Presiding Judge, Seoul Central District Court; Chief Judge, Seoul High Court; Vice Minister, National Court Administration

Mi Kyung Noh

Aug. 1965

2024

2027

Independent
Non-executive
Director

Regional Head of
Credit Risk
Review, Asia
Pacific Risk,
HSBC Hong
Kong

Executive Vice President and Chief Risk Officer, HSBC Seoul; Executive Vice President and Deputy Chief Risk Officer, HSBC Seoul

Alice Hae Yun Oh

Nov. 1974

2026

2029

Independent
Non-executive
Director

President, KAIST
Artificial
Intelligence
Research
Institute

Director, KAIST Center for MARS Artificial Intelligence Research

Seong Yeob Lee

Aug. 1967

2026

2029

Independent
Non-executive
Director

Professor of
Graduate School
of Management
of Technology,
Korea University

Foreign Attorney (U.S.), Kim & Chang; Senior Government Official, Office for Government Policy Coordination, Prime Minister’s Secretariat

Tay Seop Lim

Sept. 1963

2026

2029

Independent
Non-executive
Director

Professor of
Graduate School
of Business,
Sungkyunkwan
University

Partner, CobaltSky Partners Ltd; Representative Director, Macquarie Securities Korea Limited; Chief Executive Officer, Goldman Sachs Asset Management Korea

Other Executive Officers

In addition to our executive directors, we currently have the following executive officers:


Name	Month and Year of Birth	Position	Business Experience
Kyoung Pyo Kang	Jan. 1970	Head of Core Network Office	Head of IP Network Office
Young Sun Go	Jul. 1977	Officer of AI Advisory Division	Head of Global Business Development Office
Hyun Cheol Ku	Dec. 1971	Head of Sales & Marketing Office	Head of MNO Portfolio Office
Young Sang Kwon	Mar. 1971	Head of Communications Support Office	Head of CR Strategy Office
Hai Sung Kwon	Jul. 1975	Head of AT/DT Platform Development Office	Head of AT Platform Office
Dae Sung Kim	Dec. 1971	Head of Corporate Planning Office	Head of Corporate Planning Office
Do Yeop Kim	Nov. 1977	Head of General Counsel Center	Head of Compliance Management Legal Office
Myoung Gook Kim	Jul. 1972	Head of GPUaaS Business Office	Head of GPUaaS Business Office
Min Ho Kim	Apr. 1971	Research Advisor	Head of HR Center
Sang Bum Kim	Jul. 1970	Head of Daegu Marketing Office	Head of Distribution Office
Seok Won Kim	Feb. 1973	Head of Brand Office	Leader of Digital Media Team
Youn Jong Kim	Apr. 1973	Head of Western Network Office	Head of Western Infra Office
Woo Ram Kim	Sep. 1978	Head of CR Support Office	Leader of CR Support Team 1
Eun Jung Kim	May. 1978	On Dispatch to SUPEX Council Project	Dispatch to SUPEX Council Project
Il Young Kim	Dec. 1972	Head of Connectivity Business Office	Leader of B2B Business Planning Team
Jae Hyung Kim	May. 1979	Head of ER Office	Leader of ER Team
Jee Hyun Kim	Oct. 1972	Officer of AI Advisory Division	Officer of SK Research Institute
Ji Hyung Kim	Oct. 1971	Head of Digital Platform Business Office	Head of Biz Platform Office
Ji Hoon Kim	Sep. 1978	Head of AI Business	Head of AI Business Strategy Office
Jin Taek Kim	Mar. 1976	Head of SKMS Center	Officer of Growth Support Office, mySUNI
Tae Seuk Kim	Sep. 1980	Head of Tax Office	Project Leader of Head of Tax
Tae Yoon Kim	Apr. 1974	Head of Foundation Model Office	Leader of GLM Modeling Team
Tae Hwan Kim	Apr. 1973	Head of Compliance Office	Head of Compliance Alliance Office
Tae Hee Kim	Mar. 1977	Head of Stakeholder Value Innovation Office	Leader of Stakeholder Value Innovation Team 1
Ho Geun Kim	Sep. 1969	Head of Global Legal Office	Head of Global/AI Legal Office
Hee Sup Kim	Oct. 1968	On Dispatch to SUPEX Council Project	Head of PR Center
Kyong Hwan Ra	Apr. 1974	Head of Enterprise Solution Office	Head of New Solution Office
Seo Young Na	Jan. 1982	Head of MNO AT/DT Planning Office	Head of Subscription Product Office
Suk Kwon Na	Nov. 1966	Officer of AI Policy Research Institute	Officer of SK Research Institute


Name	Month and Year of Birth	Position	Business Experience
Jae Sang Noh	Mar. 1973	Head of Malaysia Office	Country Office Project Leader, SK E&S Indonesia
Hoon Do	Sep. 1973	On Dispatch to SUPEX Council Project	Head of PR, SK ecoplant
Man Kang Ra	Jan. 1972	Head of Corporate Culture Center	Head of Corporate Culture Division, SK AX
Young Sang Ryu	May 1970	Officer of AI Advisory Division	Executive Director, President and Chief Executive Officer
Jung Hwan Ryu	Jun. 1970	Head of Network Center; Chief Strategy & Portfolio Officer	Head of Network Infra Center
Tak Ki Yu	Feb. 1977	Head of Network Technology Office	Head of Infra Technology Office
Byung Kwan Park	Jul. 1976	Head of Core Platform Office	Head of AI Tech Product Office
Sung Joon Park	Jul. 1977	Head of Communications Center	Director, Trade Security Policy Division, Ministry of Trade, Industry and Energy
Eun Jin Park	Oct. 1977	Head of Internal Audit Office	Dispatch to SUPEX Council Project
Jong Suk Park	Nov. 1971	Head of Corporate Center	Head of Corporate Center, SK broadband
Byeong Chan Bai	Jun. 1972	Head of MNO Support Office	Head of MNO AT Office
Jae Won Bok	Aug. 1973	Head of Network O&M Office	Head of Infra Engineering Office
Ji Hwan Seok	Sep. 1976	Head of AT/DT Data Office	Head of AT Data Office
Suk Ham Sung	Apr. 1970	Head of Business Cooperation Office	Head of Policy Cooperation Office
Young Kyu Son	Mar. 1970	Head of Security Governance Office	Head of Information Security Office
In Hyuk Son	Oct. 1978	On Dispatch to SUPEX Council Project	Head of Corporate Strategy Office
Sang Min Shin	Dec. 1976	Head of Policy Development Office	Dispatch to SUPEX Council Project
Hong Beom Ahn	Sep. 1983	Head of Network AT/DT Office	Leader of AT/DT Tech Team
Seung Ji Yang	Mar. 1978	Head of Enterprise Business Technology Operations Office	Head of Vision Lab
Jong Hwan Um	Jul. 1974	Head of Sustainability Management Office	Project Leader of Business Support Team, SK Inc.
Kyung Sang Yu	Dec. 1981	Head of AI CIC	Head of Corporate Strategy Center
Doo Hee Yun	Jul. 1973	Officer of AI Policy Research Institute	Director of Information and Communications Policy Coordination Division
Myong Won Yoon	Apr. 1973	Head of Channel & Device Office	Head of Sales Office
Sung Eun Yoon	Jan. 1973	Head of Communications Center	Dispatch to SUPEX Council Project
Jae Woong Yoon	Nov. 1972	Head of Product & Brand Office	Head of Marketing Strategy Office
Hyun Sang Yoon	Apr. 1978	Head of Adot Planning Office	Head of AI Business Operation Office


Name	Month and Year of Birth	Position	Business Experience
Gahp Jae Lee	Feb. 1973	Head of Metropolitan Area Marketing Office	Head of Busan Marketing Office
Sang Yun Lee	Jan. 1971	Head of Finance Office	Head of Accounting Office
Seung Yeoll Lee	Feb. 1970	Head of Strategy Comm Office	Head of Public Relations Office
Seung Ha Lee	Feb. 1978	Head of Product Office	Head of N Service Office
Won Hee Lee	Feb. 1977	Head of Enterprise Sales Office	Leader of Retail Enterprise Biz. Team
Jae Shin Lee	Feb. 1976	Head of AI Business Development Office	Head of AI Growth Strategy Office
Jae Joon Lee	Jan. 1975	Head of SKTA	Head of P-TF
Jung Ryong Lee	Dec. 1975	Head of Agent Development Office	Head of AI Agent Development Office
Henry Jong Hyeon Lee	Dec. 1966	Head of Security Center	Director Security Engineering, Amazon
Jong Hun Lee	Nov. 1975	Head of Network Strategy Office	Head of Infra Strategy Office
Ji Seon Lee	Dec. 1976	Head of AT/DT Infra Office	Head of Cloud Platform Group, SK C&C
Hyun Jun Lee	Nov. 1974	Head of AT/DT Center	Head of ICT Services Division 1, SK AX
Hye Yeon Lee	May. 1983	Head of Customer Value Innovation Office	Head of SKMS Office
Kyoo Nam Im	Apr. 1970	Director of SK Academy	Head of Corporate Culture, SK Siltron
Sung Gook Jang	Jan. 1979	Head of AI Service Development Office	Head of Tech PM
Jung Hwan Jang	Dec. 1978	Head of General Counsel Center	Judge, Seoul High Court
Gye Bum Jun	Nov. 1976	Head of AT/DT Service Development Office	Head of AT Service Development Office
Dae Dug Jeong	Sep. 1967	Research Advisor	Head of Finance Office
Min Young Jeong	Dec. 1986	Head of AI DC Solution Office	Head of GPAA Service Office
Suk Geun Chung	Dec. 1976	Head of AI CIC	Head of GPAA Business Division
Hyung Chul Jung	Dec. 1975	Head of Security Operations Office	Chair of FIDO Korea Working Group
Dong Yeon Cho	Dec. 1975	Head of AI Convergence Office	Head of Innovation Model Office
Young Log Cho	Jun. 1971	Officer of AI Policy Research Institute	Officer of SK Research Institute
Yong Chul Cho	Feb. 1970	Head of SCM Office	Leader of ICT Infra Procurement Team
Wook Cho	Nov. 1976	Head of Eastern Network Office	Head of Central Infra Office
Ik Hwan Cho	Oct. 1977	Head of Physical AI Office	Head of Digital Twin Lab
Hyun Deuk Cho	Feb. 1975	Head of Adot Phone Office	Head of AI Communication Development Office
Seong Su Cha	Jun. 1970	Head of Management Support Office	Leader of Management Support Cell
Ho Beom Cha	Nov. 1975	Head of Chief Privacy Office	Head of Privacy Legal Office
Young Hun Chae	Sep. 1969	Head of Busan Marketing Office	Head of Daegu Marketing Office
Dong Hee Choi	Feb. 1978	Head of AI Strategy Planning Office	Head of AI Strategy Office


Name	Month and Year of Birth	Position	Business Experience
Yong Jin Choi	Feb. 1977	Head of AI Tech Center	Head of AI Platform Tech Office
Jai Won Choi	Oct. 1970	Head of Central Regional Marketing Office	Head of West Region
Tae Won Choi	Dec. 1960	Chairman	Representative Director of SK Inc., SK Innovation and SK Hynix
Jong Bok Choi	Nov. 1971	Head of Media Comm Office	Leader of Corporation PR Team
Hoon Won Choi	Aug. 1979	Head of Serious-accident Prevention Office	Leader of Serious-accident Prevention Planning Team
Myung Bok Ha	Mar. 1971	Head of Western Regional Marketing Office	Head of Service Ace
Min Yong Ha	Sep. 1970	Head of AI DC Development Office	Head of AI DC Business Division
Jae Hoon Hur	Sep. 1973	Head of Leadership Center	Officer of Biz. Innovation Division, mySUNI
Sun Kee Hong	Mar. 1972	Head of Metropolitan Network Office	Head of Metropolitan Infra Office
Jae Man Hwang	Feb. 1977	Head of HR Office	Leader of Organization & Leadership Team

Item 6.B.

Compensation

The aggregate of the remuneration paid and in-kind benefits granted to our directors (all executive directors, who also serve as our executive officers, and non-executive directors) during the year ended December 31, 2025 totaled approximately Won 5.3 billion.

The compensation of our directors who received total annual compensation exceeding Won 500 million in 2025 was as follows:

Name

Position

Composition of Total Compensation

Total
Compensation

Salary

Bonus

Gain from
Stock
Options
Exercised

Other
Earned
Income

Severance

(in millions of Won)

Young Sang Ryu

Executive Director

1,540

1,820

—

3,407

Yang Seob Kim

Executive Director

480

640

—

1,215

2,338

The maximum amount of the aggregate remuneration for our directors is determined by shareholder resolution. Severance allowances for our directors are determined by the board of directors in accordance with our regulation on severance allowances for officers, which was adopted by shareholder resolution. The regulation provides for monthly salary, performance bonus, severance payment and fringe benefits. The amount of performance bonuses is independently decided by a resolution of the board of directors.

The aggregate of the remuneration paid and in-kind benefits granted to our executive officers (excluding all executive directors, who also serve as our executive officers) during the year ended December 31, 2025 totaled approximately Won 60.4 billion.

The compensation of the five individuals who received the highest compensation among those who received total annual compensation exceeding Won 500 million in 2025 was as follows:


Name	Position	Composition of Total Compensation										Total Compensation
Name	Position	Salary		Bonus		Gain from Stock Options Exercised		Other Earned Income		Severance		Total Compensation
		(in millions of Won)
Young Sang Ryu	Executive Director	W	1,540	W	1,820		—	W	47		—	W	3,407
Bong Ho Lim	Vice President		480		646		—		17		1,215		2,358
Yang Seob Kim	Executive Director		480		640		—		3		1,215		2,338
Jaihun Jung	President and Chief Executive Officer		1,067		1,000		—		12		—		2,079
Ki Yoon Lee	Vice President		430		653		—		18		930		2,031

Stock Options

On February 23, 2023, our board of directors resolved to grant options to purchase shares of our common stock to certain directors and executive officers, which was approved by shareholder resolution on March 28, 2023. The following table summarizes the exercisable stock options granted to our current and former directors and executive officers as of March 31, 2026:

Recipient

Position

Grant date⁽¹⁾

Exercise period

Exercise
price
(per share)

Number of
shares
issuable

From

Young Sang Ryu

Executive Director

March 26, 2020

March 27, 2023

March 26, 2027

38,452

7,145

March 25, 2022

March 26, 2025

March 25, 2029

56,860

98,425

⁽²⁾

Poong Young Yoon

Non-executive Director

March 26, 2020

March 27, 2023

March 26, 2027

38,452

5,293

Seong Ho Ha

Former Head of Corporate Relations Center

March 26, 2020

March 27, 2023

March 26, 2027

38,452

5,028

March 25, 2022

March 26, 2024

March 25, 2027

56,860

9,341

Dong Hwan Cho

Former Chief Information Officer

March 26, 2020

March 27, 2023

March 26, 2027

38,452

4,631

March 25, 2022

March 26, 2024

March 25, 2027

56,860

8,697

HyunA Lee

Former Head of Comm Service

March 26, 2020

March 27, 2023

March 26, 2027

38,452

4,631

Myung Jin Han

Head of MNO CIC

March 25, 2022

March 26, 2024

March 25, 2027

56,860

11,274

Bong Ho Lim

Former Head of MNO Business Division

March 25, 2022

March 26, 2024

March 25, 2027

56,860

8,858

Jin Won Kim

Former Head of Corporate Planning

March 25, 2022

March 26, 2024

March 25, 2027

56,860

10,629

Yong Joo Park

Former Head of ESG

March 25, 2022

March 26, 2024

March 25, 2027

56,860

10,334

Hee Sup Kim

On Dispatch to SUPEX Council Project

March 25, 2022

March 26, 2024

March 25, 2027

56,860

7,086

Jung Whan Ahn

Former Head of Corporate Culture

March 25, 2022

March 26, 2024

March 25, 2027

56,860

8,858

(1)	The stock options granted on March 28, 2023 were cancelled and replaced with PSUs.

(2)	Two-thirds of the stock options granted to Young Sang Ryu on March 25, 2022 were cancelled and replaced with PSUs.

Other Equity-based Compensation

PSU Program

Since 2023, we have been granting PSUs to certain of our and our subsidiaries’ directors (including the representative director) and executive officers in order to align management and shareholder interests and further align growth in our enterprise value with management compensation. Future performance targets are set when entering into the relevant stock compensation agreement, and the final number of shares to be received by each grantee, which will be settled out of our treasury shares, will be determined based on the achievement levels of such targets subject to approval by the board of directors. In consideration of the representative director’s role and importance, additional shares of up to 100% of the representative director’s annual salary at the time of the PSU grant may be granted in recognition of his or her outstanding achievements upon satisfaction of certain conditions. The validity of the PSUs, which is subject to a three-year vesting period, is dependent on the grantee meeting a minimum term of incumbency under his or her title until the end of the year in which the PSUs were issued. In 2023, we granted a total of 228,708 PSUs to 194 directors and executive officers. In 2024, we granted a total of 243,451 PSUs to 213 directors and executive officers. In 2025, we did not grant any PSUs.

Shareholder Participation Program

Since 2021, pursuant to the Korean Commercial Code, we have been operating the “Shareholder Participation Program” as equity compensation in order to align management and shareholder interests and strengthen commitment to enhance our enterprise value. All of our employees, including the representative director, are eligible to participate in the Shareholder Participation Program, under which we grant treasury shares equal to a portion of a participating employee’s bonus. The participating employee must be employed with us at the time of actual grant and there is no transfer restriction period. In 2023, we granted a total of 434,088 treasury shares to 1,863 employees. In 2024, we granted a total of 498,135 treasury shares to 1,743 employees. In 2025, we did not grant any treasury shares to employees as part of the Shareholder Participation Program.

Stock Grant Program

Since 2021, we have been granting portions of our independent non-executive directors’ remuneration in the form of shares in order to align the interests of our board of directors and shareholders. The number of shares granted, which is in the form of treasury shares, is based on the independent non-executive director’s role and responsibility and our director compensation payment criteria. Transfer of such shares is restricted for three years following initial receipt. In 2023, we granted a total of 6,999 treasury shares to five independent non-executive directors. In 2024, we granted a total of 5,477 treasury shares to five independent non-executive directors. In 2025, we granted a total of 4,860 treasury shares to five independent non-executive directors.

Item 6.C.

Board Practices

For information regarding the expiration of each director’s term of appointment, as well as the period from which each director has served in such capacity, see the table set out under “Item 6.A. Directors and Senior Management” above.

Termination of Directors’ Services

Directors are given a retirement and severance payment upon termination of employment in accordance with our internal regulations on severance payments. Upon retirement, directors who have made significant contributions to our company during their term may be appointed to serve either as an advisor to us or as an officer of an affiliate company.

Audit Committee

Under relevant Korean laws and our articles of incorporation, we are required to have an audit committee under the board of directors. The committee is composed of at least three members, two-thirds of whom must be

independent non-executive directors in accordance with applicable rules. The members of the audit committee are appointed annually by a resolution of the general meeting of shareholders. They are required to:

•

examine the agenda for the general meeting of shareholders;

•

examine financial statements and other reports to be submitted by the board of directors to the general meeting of shareholders;

•

review the administration by the board of directors of our affairs; and

•

examine the operations and asset status of us and our subsidiaries.

In addition, the audit committee must appoint independent auditors to examine our financial statements. An audit and review of our financial statements by independent auditors is required for the purposes of a securities report. Listed companies must provide such report on an annual, semi-annual and quarterly basis to the Financial Services Commission (the “FSC”) and the KRX KOSPI Market.

Our audit committee is composed of four independent non-executive directors: Tay Seop Lim, Chang Bo Kim, Mi Kyung Noh and Seong Yeob Lee, each of whom is financially literate and independent under the rules of the NYSE as applicable. Tay Seop Lim is the chairperson of the committee. The board of directors has determined that Tay Seop Lim is an “audit committee financial expert” as defined under the applicable rules of the SEC. See “Item 16A. Audit Committee Financial Expert.”

Independent Director Nomination Committee

This committee is devoted to recommending independent non-executive directors for the board of directors. The objective of the committee is to help promote fairness and transparency in the nomination of candidates for these positions. The board of directors decides from time to time who will comprise the members of this committee. The committee is comprised of one non-independent director, Poong Young Yoon, and two independent directors, Alice Haeyun Oh and Seong Yeob Lee. Alice Haeyun Oh is the chairperson of the committee.

Future Strategy Committee

This committee is responsible for reviewing our annual business plan as well as establishing our key performance indicators (“KPIs”) and measuring our performance against such KPIs. The committee is comprised of two executive directors, Jaihun Jung and Myung Jin Han, one non-independent director, Poong Young Yoon, and five independent directors, Chang Bo Kim, Alice Haeyun Oh, Mi Kyung Noh, Seong Yeob Lee and Tay Seop Lim. Chang Bo Kim is the chairperson of the committee.

Compensation Committee

This committee oversees our overall compensation scheme for the representative director and the non-independent directors. The committee is responsible for reviewing both the criteria for and level of compensation. It is comprised of one non-independent director, Poong Young Yoon, and three independent directors, Mi Kyung Noh, Alice Haeyun Oh and Chang Bo Kim. Mi Kyung Noh is the chairperson of the committee.

ESG Committee

This committee is responsible for establishing and reviewing the direction of our environmental, social and governance policy as well as public filings and communications with related parties. This committee was established to help us achieve world-class sustainable growth and to help us fulfill our corporate social responsibilities. It is comprised of three independent directors, Seong Yeob Lee, Chang Bo Kim and Tay Seop Lim. Seong Yeob Lee is the chairperson of the committee.

Item 6.D.

Employees

The following table sets forth the numbers of our regular employees, temporary employees and total employees as of the dates indicated:


	Regular Employees		Temporary Employees		Total
December 31, 2023		25,103		1,092		26,195
December 31, 2024		23,401		823		24,224
December 31, 2025		21,883		840		22,723

Labor Relations

As of December 31, 2025, SK Telecom had a company union consisting of 2,270 regular employees out of 4,735 total regular employees. We have never experienced a work stoppage of a serious nature. Every two years, the union and management negotiate and enter into a new collective bargaining agreement that has a two-year duration, which is focused on employee benefits and welfare. Employee wages are separately negotiated on an annual basis. Our wage negotiations for 2023 were completed in September 2023 and resulted in an average monthly wage increase of 3.0% for SK Telecom employees. Our wage negotiations for 2024 were completed in September 2024 and resulted in an average monthly wage increase of 2.9% for SK Telecom employees. Our wage negotiations for 2025 were completed in September 2025 and resulted in an average monthly wage increase of 3.0% for SK Telecom employees. We consider our relations with our employees to be good.

Employee Benefits

In accordance with the National Pension Act of Korea, we contribute an amount equal to 4.5% of an employee’s standard monthly wages, and each employee contributes 4.5% of his or her standard monthly wages, into his or her personal pension account, as of the date of this annual report. Such rates, however, are scheduled to gradually increase to 6.5% by 2033. Employees are eligible to participate in an employee stock ownership association. We are not required to, and we do not, make any contributions to the employee stock ownership association, although we subsidize the employee stock ownership association through the Employee Welfare Fund by providing low interest rate loans to employees who desire to purchase our stock through the plan in the event of a capitalization by the association.

We are required to pay a severance amount to eligible employees who voluntarily or involuntarily cease employment with us, including through retirement. This severance amount is based upon the employee’s length of service with us and the employee’s salary level at the time of severance. The present value of our defined benefit obligations, which is the present value of total accrued and unpaid retirement and severance benefits for our employees, as of December 31, 2025, was Won 1,051.5 billion, which was more than offset by the fair value of our defined benefit plan assets of Won 1,257.0 billion as of such date. Accordingly, we recognized defined benefit assets of Won 205.5 billion as of December 31, 2025. Under Korean laws and regulations, we are prevented from involuntarily terminating a full-time employee except under certain limited circumstances. In September 2000, we entered into an employment stabilization agreement with the union. Among other things, in the event that we reorganize a department into a separate entity or we outsource an employee to a separate entity where the wage is lower, this agreement provides for a guarantee of the same wage level for the year that such an event occurs.

Under the Basic Labor Welfare Act, we may also contribute a certain percentage of our annual profit before income tax for employee welfare. Contribution amounts are determined annually following negotiation with the union. The contribution amount for 2023 was set at 4.58% of SK Telecom’s profit before income tax on a separate basis, or Won 62.0 billion. The contribution amount for 2024 was set at 4.06% of SK Telecom’s profit before income tax on a separate basis, or Won 59.9 billion. The contribution amount for 2025 was set at 8.13% of SK Telecom’s profit before income tax on a separate basis, or Won 59.9 billion.

In addition, we provide our employees with miscellaneous other fringe benefits including medical cost subsidies, family camp programs and sabbatical programs for long-term employees.

Item 6.E.

Share Ownership

The following table sets forth the share ownership by our directors and executive officers as of March 31, 2026:

Name

Position

Number
of
Shares
Owned

Percentage of
Total Shares
Outstanding

Special
Voting
Rights

Stock
Options

Directors:

Jaihun Jung

Executive Director, President and Chief Executive Officer

1,518

None

—

Myung Jin Han

Head of MNO CIC

11,379

None

11,274

Poong Young Yoon

Non-executive Director

4,639

None

5,293

Chang Bo Kim

Independent Non-executive Director

1,493

None

—

Mi Kyung Noh

Independent Non-executive Director

1,846

None

—

Alice Hae Yun Oh

Independent Non-executive Director

3,184

None

—

Seong Yeob Lee

Independent Non-executive Director

—

None

—

Tay Seop Lim

Independent Non-executive Director

—

None

—

Executive Officers:

Kyoung Pyo Kang

Head of Core Network Office

2,290

None

—

Young Sun Go

Officer of AI Advisory Division

—

None

—

Hyun Cheol Ku

Head of Sales & Marketing Office

3,354

None

—

Young Sang Kwon

Head of Communications Support Office

4,638

None

—

Hai Sung Kwon

Head of AT/DT Platform Development Office

2,199

None

—

Dae Sung Kim

Head of Corporate Planning Office

3,352

None

—

Do Yeop Kim

Head of General Counsel Center

—

None

—

Myoung Gook Kim

Head of GPUaaS Business Office

1,474

None

—

Min Ho Kim

Research Advisor

—

None

—

Sang Bum Kim

Head of Daegu Marketing Office

2,677

None

—

Seok Won Kim

Head of Brand Office

1,989

None

—

Youn Jong Kim

Head of Western Network Office

—

None

—

Woo Ram Kim

Head of CR Support Office

—

None

—

Eun Jung Kim

On Dispatch to SUPEX Council Project

—

None

—

Il Young Kim

Head of Connectivity Business Office

1,010

None

—

Jae Hyung Kim

Head of ER Office

403

None

—

Jee Hyun Kim

Officer of AI Advisory Division

—

None

—

Ji Hyung Kim

Head of Digital Platform Business Office

1,957

None

—

Ji Hoon Kim

Head of AI Business

2,299

None

—

Jin Taek Kim

Head of SKMS Center

None

—

Tae Seuk Kim

Head of Tax Office

—

None

—

Tae Yoon Kim

Head of Foundation Model Office

474

None

—

Tae Hwan Kim

Head of Compliance Office

928

None

—

Tae Hee Kim

Head of Stakeholder Value Innovation Office

4,000

None

—

Ho Geun Kim

Head of Global Legal Office

1,982

None

—

Name

Position

Number
of
Shares
Owned

Percentage of
Total Shares
Outstanding

Special
Voting
Rights

Stock
Options

Hee Sup Kim

On Dispatch to SUPEX Council Project

5,714

None

7,086

Kyong Hwan Ra

Head of Enterprise Solution Office

1,100

None

—

Seo Young Na

Head of MNO AT/DT Planning Office

—

None

—

Suk Kwon Na

Officer of AI Policy Research Institute

—

None

—

Jae Sang Noh

Head of Malaysia Office

—

None

—

Hoon Do

On Dispatch to SUPEX Council Project

—

None

—

Man Kang Ra

Head of Corporate Culture Center

—

None

—

Jung Hwan Ryu

Head of Network Center; Chief Strategy & Portfolio Officer

5,102

None

—

Tak Ki Yu

Head of Network Technology Office

701

None

—

Byung Kwan Park

Head of Core Platform Office

600

None

—

Sung Joon Park

Head of Communications Center

—

None

—

Eun Jin Park

Head of Internal Audit Office

—

None

—

Jong Suk Park

Head of Corporate Center

1,822

None

—

Byeong Chan Bai

Head of MNO Support Office

—

None

—

Jae Won Bok

Head of Network O&M Office

1,297

None

—

Ji Hwan Seok

Head of AT/DT Data Office

2,256

None

—

Suk Ham Sung

Head of Business Cooperation Office

5,322

None

—

Young Kyu Son

Head of Security Governance Office

2,918

None

—

In Hyuk Son

On Dispatch to SUPEX Council Project

4,352

None

—

Sang Min Shin

Head of Policy Development Office

—

None

—

Hong Beom Ahn

Head of Network AT/DT Office

150

None

—

Seung Ji Yang

Head of Enterprise Business Technology Operations Office

2,063

None

—

Jong Hwan Um

Head of Sustainability Management Office

597

None

—

Kyung Sang Yu

Head of AI CIC

—

None

—

Doo Hee Yun

Officer of AI Policy Research Institute

—

None

—

Myong Won Yoon

Head of Channel & Device Office

1,000

None

—

Sung Eun Yoon

Head of Communications Center

1,911

None

—

Jae Woong Yoon

Head of Product & Brand Office

2,163

None

—

Hyun Sang Yoon

Head of Adot Planning Office

1,070

None

—

Gahp Jae Lee

Head of Metropolitan Area Marketing Office

5,716

None

—

Sang Yun Lee

Head of Finance Office

200

None

—

Seung Yeoll Lee

Head of Strategy Comm Office

3,612

None

—

Seung Ha Lee

Head of Product Office

1,055

None

—

Won Hee Lee

Head of Enterprise Sales Office

—

None

—

Jae Shin Lee

Head of AI Business Development Office

2,563

None

—

Jae Joon Lee

Head of SKTA

200

None

—

Jung Ryong Lee

Head of Agent Development Office

2,675

None

—

Henry Jong Hyeon Lee

Head of Security Center

—

None

—

Jong Hun Lee

Head of Network Strategy Office

1,622

None

—

Ji Seon Lee

Head of AT/DT Infra Office

—

None

—

Hyun Jun Lee

Head of AT/DT Center

—

None

—

Hye Yeon Lee

Head of Customer Value Innovation Office

3,021

None

—

Kyoo Nam Im

Director of SK Academy

—

None

—

Name

Position

Number
of Shares
Owned

Percentage of
Total Shares
Outstanding

Special
Voting
Rights

Stock
Options

Sung Gook Jang

Head of AI Service Development Office

—

None

—

Jung Hwan Jang

Head of General Counsel Center

400

None

—

Gye Bum Jun

Head of AT/DT Service Development Office

—

None

—

Dae Dug Jeong

Research Advisor

3,855

None

—

Min Young Jeong

Head of AI DC Solution Office

—

None

—

Suk Geun Chung

Head of AI CIC

—

None

—

Hyung Chul Jung

Head of Security Operations Office

—

None

—

Dong Yeon Cho

Head of AI Convergence Office

703

None

—

Young Log Cho

Officer of AI Policy Research Institute

5,135

None

—

Yong Chul Cho

Head of SCM Office

1,482

None

—

Wook Cho

Head of Eastern Network Office

1,884

None

—

Ik Hwan Cho

Head of Physical AI Office

3,824

None

—

Hyun Deuk Cho

Head of Adot Phone Office

1,727

None

—

Seong Su Cha

Head of Management Support Office

—

None

—

Ho Beom Cha

Head of Chief Privacy Office

—

None

—

Young Hun Chae

Head of Busan Marketing Office

2,637

None

—

Dong Hee Choi

Head of AI Strategy Planning Office

—

None

—

Yong Jin Choi

Head of AI Tech Center

3,650

None

—

Jai Won Choi

Head of Central Regional Marketing Office

3,000

None

—

Jong Bok Choi

Head of Media Comm Office

—

None

—

Hoon Won Choi

Head of Serious-accident Prevention Office

3,776

None

—

Myung Bok Ha

Head of Western Regional Marketing Office

6,000

None

—

Min Yong Ha

Head of AI DC Development Office

9,099

None

—

Jae Hoon Hur

Head of Leadership Center

—

None

—

Sun Kee Hong

Head of Metropolitan Network Office

3,984

None

—

Jae Man Hwang

Head of HR Office

891

None

—

Total

172,012

23,653

*	Less than 1%.

See “Item 6.B. Compensation” for information regarding the exercisable stock options granted to our directors and executive officers.

Item 6.F.

Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation

Not applicable.

Item 7.

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

Item 7.A.

Major Shareholders

As of the close of our shareholders’ registry on March 31, 2026, approximately 62.3% of our issued shares were held in Korea by approximately 275,606 shareholders.

The following table sets forth certain information as of December 31, 2025 with respect to any person known to us to be the beneficial owner of more than 5.0% of our common shares:


Shareholder	Number of Shares		Percentage of Total Shares Issued⁽¹⁾			Percentage of Total Shares Outstanding⁽²⁾
SK Inc.		65,668,397		30.6	%		30.8	%
National Pension Service		14,332,207		6.7			6.7

(1)	Calculated based on 214,790,053 total issued shares, which include 1,807,778 treasury shares, as of December 31, 2025.

(2)	Calculated based on 212,982,275 total outstanding shares as of December 31, 2025.

The following table sets forth significant changes in the percentage ownership held by our major shareholders during the past three years:


	As of December 31,
Shareholder	2025			2024			2023
	(As a percentage of total issued shares)⁽¹⁾
SK Group⁽²⁾		30.6	%		30.6	%		30.0	%
SK Inc.		30.6			30.6			30.0
National Pension Service		6.7			8.8			7.5

(1)

Includes 1,807,778 shares, 1,903,711 shares and 6,133,414 shares held in treasury as of December 31, 2025, 2024 and 2023, respectively. In 2025, we transferred 95,933 treasury shares as bonus payments to certain of our officers and employees. In 2024, we repurchased 317,000 common shares under a share repurchase agreement with SK Securities Co., Ltd., a securities brokerage firm (“SK Securities”), dated July 27, 2023 (the “2023 Share Repurchase Agreement”), and transferred 503,612 treasury shares as bonus payments to certain of our officers and employees. In addition, we cancelled 4,043,091 treasury shares in 2024. In 2023, we repurchased 5,773,410 common shares under the 2023 Share Repurchase Agreement and transferred 441,087 treasury shares as bonus payments to certain of our officers and employees.

(2)	SK Group’s ownership interest as of December 31, 2025, 2024 and 2023 consisted of the ownership interest of SK Inc. only.

Except as described above, other than companies in the SK Group, no other persons or entities known by us to be acting in concert, directly or indirectly, jointly or severally, own in excess of 5.0% of our total shares outstanding or exercise control or could exercise control over our business.

As of March 31, 2026, SK Inc. held 30.6% of our total issued shares of common stock. For a description of our foreign ownership limitation, see “Item 3.D. Risk Factors — Risks Relating to Our Business — If SK Inc. causes us to breach the foreign ownership limitations on our common shares, we may experience a change of control.” and “Item 4.B. Business Overview — Law and Regulation — Foreign Ownership and Investment Restrictions and Requirements.” In the event that SK Inc. announces plans of a sale of our shares, we expect to be able to discuss the details of such sale with them in advance and will endeavor to minimize any adverse effects on our share prices as a result of such sale.

As of March 31, 2026, the total number of our common shares outstanding was 213,000,896.

Other than as disclosed herein, there are no other arrangements, to the best of our knowledge, which would result in a material change in the control of us. Our major shareholders do not have different voting rights.

Item 7.B.

Related Party Transactions

We are part of the SK Group of affiliated companies. See “Item 7.A. Major Shareholders.” As disclosed in note 35 of the notes to our consolidated financial statements, we had related party transactions with a number of affiliated companies of the SK Group during the year ended December 31, 2025.

SK Networks

As of December 31, 2025, we had Won 0.3 billion of accounts receivable from SK Networks. As of the same date, we had Won 123.9 billion of accounts payable to SK Networks, mainly relating to payments for wireless devices provided by PS&Marketing. The operating expenses we incurred with respect to SK Networks, including aggregate fees we paid to SK Networks for dealer commissions, amounted to Won 977.9 billion in 2025, Won 1,011.2 billion in 2024 and Won 970.7 billion in 2023.

SK Inc.

We enter into agreements with SK Inc. from time to time for specific information technology-related projects, and we also pay SK Inc. for use of the SK brand. The operating expenses we incurred with respect to SK Inc., including aggregate fees we paid to SK Inc. for such information technology services and the use of the SK brand, amounted to Won 440.2 billion in 2025, Won 428.1 billion in 2024 and Won 415.2 billion in 2023. We also purchase various information technology-related equipment from SK Inc. from time to time. The total amount of such purchases was Won 256.3 billion in 2025, Won 125.7 billion in 2024 and Won 120.9 billion in 2023. We are a party to several service agreements with SK Inc. relating to the development and maintenance of our information technologies systems.

In addition, in June 2025, SK Broadband acquired the business operations of the Pangyo Data Center from SK Inc. for Won 506.8 billion as part of its initiative to expand its data center operations and generate synergy.

Item 7.C.

Interests of Experts and Counsel

Not applicable.

Item 8.

FINANCIAL INFORMATION

Item 8.A.

Consolidated Statements and Other Financial Information

See “Item 18. Financial Statements” and pages F-1 through F-122.

Legal Proceedings

KFTC Proceedings

In August 2023, the KFTC imposed a fine of Won 16.8 billion, Won 13.9 billion and Won 2.8 billion on SK Telecom (which SK Telecom has paid in full), KT and LG U+, respectively, and issued a correctional order for violating the Act on Fair Labeling and Advertising by engaging in inappropriate and potentially misleading advertising regarding the transmission speeds of their respective 5G wireless services. In August 2023, we initiated an administrative proceeding with the Seoul High Court to request the revocation of the fine and the correctional order, which proceeding currently remains pending.

In January 2024, the KFTC imposed a fine of Won 8.6 billion, Won 5.8 billion, Won 1.4 billion and Won 4.1 billion on KT, LG U+, SK Telecom (which SK Telecom has paid in full) and SK O&S Co., Ltd., a wholly-owned subsidiary of SK Telecom which engages in the base station maintenance service business, respectively, and issued a correctional order for violating the Fair Trade Act by colluding from 2013 to 2019 to reduce costs for renting locations that house their base stations.

In June 2025, the KFTC imposed a fine of Won 38.8 billion, Won 27.7 billion and Won 29.9 billion on SK Telecom (which SK Telecom has paid in full), LG U+ and KT, respectively, and issued a correctional order for violating the Fair Trade Act, including in connection with the sharing of certain customer activation data among

these companies in order to align the sales incentives paid to their mobile phone retailers. In September 2025, we initiated an administrative proceeding with the Seoul High Court to request the revocation of the fine and the correctional order, which proceeding currently remains pending.

PIPC Proceeding

In August 2025, the PIPC imposed a fine of Won 134.8 billion and an administrative penalty of Won 9.6 million on us (which we have paid in full) and issued a correctional order in connection with the cybersecurity incident of which we became aware in April 2025. See “Item 3.D. Risk Factors — Risks Relating to Our Business — Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.” In January 2026, we filed an administrative lawsuit with the Seoul Administrative Court challenging such decision and requesting the revocation of the fine, the administrative penalty and the correctional order, which proceeding currently remains pending.

Other Proceedings

In November 2025, the Dispute Mediation Committee of the PIPC proposed that we pay Won 300,000 in compensation to each of the 3,998 mobile phone service subscribers who sought dispute mediation in connection with the cybersecurity incident of which we became aware in April 2025. See “Item 3.D. Risk Factors — Risks Relating to Our Business — Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.” In the same month, we submitted our rejection to accept such settlement proposal to the PIPC. The mediation process was terminated following our rejection of the proposal.

In December 2025, the Consumer Dispute Settlement Commission of the Korea Consumer Agency proposed that we pay Won 100,000 in compensation to each of the 58 mobile phone service subscribers who sought dispute mediation in connection with the above-described cybersecurity incident. See “Item 3.D. Risk Factors — Risks Relating to Our Business — Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.” In January 2026, we submitted our rejection to accept such settlement proposal to the Korea Consumer Agency. The mediation process was terminated following our rejection of the proposal.

Certain of our mobile phone service subscribers have also filed a number of civil lawsuits seeking alleged damages in connection with this incident, all of which are currently pending before trial courts. While we are vigorously defending ourselves in each of these cases, we are unable to predict their outcomes, and no assurance can be made that additional customers will not pursue additional legal actions to seek alleged damages against us in connection with this incident.

See “Item 3.D. Risk Factors — Risks Relating to Our Business — Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.”

Dividends

Annual dividends, if any, on our outstanding shares must be approved at the annual general meeting of shareholders. This meeting is generally held in March of the following year, and the annual dividend is generally paid shortly after the meeting. Since our shareholders have discretion to declare annual dividends, we cannot give any assurance as to the amount of dividends per share or that any dividends will be declared at all. Interim dividends, if any, could be approved by a resolution of our board of directors. We replaced the interim dividend system with a quarterly dividend system pursuant to an amendment to our articles of incorporation at our annual general meeting of shareholders held on March 25, 2021. Once declared, dividends must be claimed within five years, after which the right to receive the dividends is extinguished and reverted to us.

We pay cash dividends to the ADR depositary in Won. Under the terms of the deposit agreement, cash dividends received by the ADR depositary generally are to be converted by the ADR depositary into Dollars and distributed to the holders of the ADSs, less withholding tax, other governmental charges and the ADR depositary’s fees and expenses. The ADR depositary’s designated bank in Korea must approve this conversion and remittance of cash dividends. See “Item 10.D. Exchange Controls — Korean Foreign Exchange Controls and Securities Regulations.”

The following table sets forth the interim and annual dividend per share and the aggregate total amount of dividends declared, as well as the number of outstanding shares entitled to dividends, with respect to the years ended December 31, 2023, 2024 and 2025. The annual dividend was paid in the immediately following year, and the interim dividends were paid in the same year.


Dividend Type	Dividend per Share		Total Amount of Dividends		Number of Shares Entitled to Dividend
	(In Won)		(In billions of Won)
Interim dividend (for the period ended March 31, 2023)		830		181.3		218,466,141
Interim dividend (for the period ended June 30, 2023)		830		181.3		218,473,140
Interim dividend (for the period ended September 30, 2023)		830		179.6		216,412,898
Annual dividend (for the year ended December 31, 2023)		1,050		223.3		212,699,730
Interim dividend (for the period ended March 31, 2024)		830		176.7		212,880,865
Interim dividend (for the period ended June 30, 2024)		830		176.7		212,886,342
Interim dividend (for the period ended September 30, 2024)		830		176.7		212,886,342
Annual dividend (for the year ended December 31, 2024)		1,050		223.5		212,886,342
Interim dividend (for the period ended March 31, 2025)		830		176.7		212,886,342
Interim dividend (for the period ended June 30, 2025)		830		176.8		212,982,275

We did not pay any interim dividend for the period ended September 30, 2025 or annual dividend for the period ended December 31, 2025.

Holders of non-voting shares are entitled to receive dividends in priority to the holders of common shares. The dividend on the non-voting shares is between 9.0% and 25.0% of the par value as determined by the board of directors at the time of their issuance. If the dividends for common shares exceed the dividends for non-voting shares, the holders of non-voting shares will be entitled to participate in the distribution of such excess amount with the holders of common shares. If the amount available for dividends is less than the aggregate amount of the minimum required dividend, holders of non-voting shares will be entitled to receive such accumulated unpaid dividend from dividends payable in the next fiscal year before holders of common shares. There are no non-voting shares issued or outstanding.

We declare dividends annually at the annual general meeting of shareholders which is generally held within three months after the end of the fiscal year. For the purpose of determining the shareholders who are entitled to annual dividends, we may set a record date with at least two weeks’ prior public notice by a resolution of our board of directors. We may distribute the annual dividend in cash or in shares. However, a dividend of shares must be distributed at par value. Dividends in shares may not exceed one-half of the annual dividend. Our obligation to pay dividend expires if no claim to dividend is made for five years from the payment date.

Under the Korean Commercial Code, we may pay an annual dividend only out of the excess of our net assets, on a non-consolidated basis, over the sum of (1) our stated capital, (2) the total amount of our capital

surplus reserve, (3) legal reserve accumulated up to the end of the relevant dividend period and (4) the increase in our net asset value resulting from the evaluation of our assets and liabilities that has not been offset against unrealized losses. In addition, we may not pay an annual dividend unless we have set aside as a legal reserve an amount equal to at least 10.0% of the cash portion of the annual dividend or until we have accumulated a legal reserve of not less than one-half of our stated capital. We may not use our legal reserve to pay cash dividends but may transfer amounts from our legal reserve to capital stock or use our legal reserve to reduce an accumulated deficit.

In addition, the FSCMA and our articles of incorporation provide that, in addition to annual dividends, we may pay quarterly dividends. Unlike annual dividends, the decision to pay quarterly dividends can be made by a resolution of the board of directors and is not subject to shareholder approval. For the purpose of determining the shareholders who are entitled to quarterly dividends, we may set a record date with at least two weeks’ prior public notice by a resolution of our board of directors, which needs to take place within 45 days of March 31, June 30 or September 30 of the relevant fiscal year. Any quarterly dividends must be paid in cash.

Under the FSCMA, the total amount of quarterly dividends payable in a fiscal year shall not be more than the net assets on the balance sheet of the immediately preceding fiscal year, after deducting (1) a company’s capital in the immediately preceding fiscal year, (2) the aggregate amount of its capital reserves and legal reserves accumulated up to the immediately preceding fiscal year, (3) the amount of earnings for dividend payments confirmed at the general shareholders’ meeting with respect to the immediately preceding fiscal year and (4) the amount of legal reserve that should be set aside for the current fiscal year following the quarterly dividend payment. In addition, no quarterly dividends can be paid if there is a concern over the net assets of the current fiscal year falling short of the aggregate sum of (1) our stated capital, (2) the total amount of our capital surplus reserve, (3) legal reserve accumulated up to the end of the current fiscal year and (4) the increase in our net asset value resulting from the evaluation of our assets and liabilities that has not been offset against unrealized losses.

Our obligation to pay quarterly dividends expires if no claims to such dividends are made for a period of five years from the payment date.

Item 8.B.

Significant Changes

None.

Item 9.

THE OFFER AND LISTING

Item 9.A.

Offering and Listing Details

These matters are described under “Item 9.C. Markets” below where relevant.

Item 9.B.

Plan of Distribution

Not applicable.

Item 9.C.

Markets

The principal trading market for our common shares is the KRX KOSPI Market. Our common shares are traded on the KRX KOSPI Market under the identification code 017670. As of March 31, 2026, 213,000,896 shares of our common stock were outstanding.

The ADSs are traded on the NYSE. The ADSs have been issued by the ADR depositary and are traded on the NYSE under the ticker symbol “SKM.” Each ADS represents five-ninths of one share of our common stock.

Item 9.D.

Selling Shareholders

Not applicable.

Item 9.E.

Dilution

Not applicable.

Item 9.F.

Expenses of the Issue

Not applicable.

Item 10.

ADDITIONAL INFORMATION

Item 10.A.

Share Capital

Not applicable.

Item 10.B.

Memorandum and Articles of Association

Description of Capital Stock

This section provides information relating to our capital stock, including brief summaries of material provisions of our articles of incorporation, the FSCMA, the Korean Commercial Code, the Telecommunications Business Act and related laws of Korea, all as currently in effect. The following summaries are subject to, and are qualified in their entirety by reference to, our articles of incorporation and the applicable provisions of the FSCMA, the Korean Commercial Code and the Telecommunications Business Act. We have filed a copy of our articles of incorporation as an exhibit to our annual reports on Form 20-F.

General

The name of our company is SK Telecom Co., Ltd. We are registered under the laws of Korea under the commercial registry number of 110111-0371346. As specified in Article 2 (Objectives) of our articles of incorporation, as amended, our objectives are the rational management of the telecommunications business, development of telecommunications technology, and contribution to public welfare and convenience. In order to achieve these objectives, we are engaged in the following:

•

information and communication business;

•

sale and lease of subscriber handsets;

•

new media business;

•

advertising business;

•

mail order sales business;

•

real estate business (development, management and leasing, etc.) and chattel leasing business;

•

research and technology development relating to the first four items above;

•

overseas and import/export business relating to the first four items above;

•

manufacture and distribution business relating to the first four items above;

•

travel business;

•

electronic financial services business;

•

film business (production, import, distribution and screening);

•

lifetime education and management of lifetime educational facilities;

•

electric engineering business;

•

information- and communication-related engineering business;

•

ubiquitous city construction and related service business;

•

any related business through investment, management and operation of our Korean or offshore subsidiaries and investment companies;

•

construction business, including the machine and equipment business;

•

export/import business and export/import intermediation/agency business;

•

electrical business such as intelligent electrical grid business;

•

data production, trading and utilization business, including MyData business;

•

manufacture, import, maintenance, sale and lease of medical equipment and veterinary medical equipment business; and

•

any business or undertaking incidental or conducive to the attainment of the objectives stated above.

Currently, our authorized share capital is 670,000,000 shares, which consists of shares of common stock, par value Won 100 per share, and shares of non-voting stock, par value Won 100 per share (common shares and non-voting shares together are referred to as “shares”). Under our articles of incorporation, we are authorized to issue up to 5,500,000 non-voting preferred shares. As of March 31, 2026, 214,790,053 common shares were issued, of which 1,789,157 shares were held by us in treasury. In connection with the Spin-off, we also engaged in the Stock Split, pursuant to which the par value of our common stock changed from Won 500 per share to Won 100 per share and the number of issued shares of our common stock increased from 72,060,143 shares to 360,300,715 shares, in each case effective as of October 28, 2021. In 2023, we repurchased 5,773,410 common shares under the 2023 Share Repurchase Agreement and transferred 441,087 treasury shares as bonus payments to certain of our officers and employees. In 2024, we repurchased 317,000 common shares under the 2023 Share Repurchase Agreement and transferred 503,612 treasury shares as bonus payments to certain of our officers and employees. In addition, we cancelled 4,043,091 treasury shares in 2024. In 2025, we transferred 95,933 treasury shares as bonus payments to certain of our officers and employees. We have never issued any non-voting preferred shares. All of the issued and outstanding common shares are fully-paid and non-assessable and are in registered form.

Board of Directors

Meetings of the board of directors are convened by the representative director as he or she deems necessary or upon the request of three or more directors. The board of directors determines all important matters relating to our business. In addition, the prior approval of the majority of the independent non-executive directors is required for certain matters, which include:

•

investment by us or any of our subsidiaries in a foreign company in equity or acquisition of such foreign company’s other overseas assets in an amount equal to 5.0% or more of our equity under our most recent balance sheet; and

•

contribution of capital, loans or guarantees, acquisition of our subsidiaries’ assets or similar transactions with our affiliated companies in excess of Won 10.0 billion through one or a series of transactions.

Resolutions of the board must be adopted in the presence of a majority of the directors then in office and by the affirmative vote of a majority of the directors present. No director who has an interest in a matter for resolution may exercise his or her vote upon such matter.

There are no specific shareholding requirements for director’s qualification. Directors are elected at a general meeting of shareholders if the approval of the holders of the majority of the voting shares present at such meeting is obtained and if such majority also represents at least one-fourth of the total number of shares outstanding. Under the Korean Commercial Code, unless otherwise stated in the articles of incorporation, holders of an aggregate of 1.0% or more of the outstanding shares with voting rights may request cumulative voting in any election for two or more directors. Our articles of incorporation do not permit cumulative voting for the election of directors.

The term of office for directors is until the close of the third annual general shareholders meeting convened after he or she commences his or her term. Our directors may serve consecutive terms and our shareholders may remove them from office at any time by a special resolution adopted at a general meeting of shareholders. The total term of office of independent directors may not exceed six years, and when combined with the term of office at our affiliates, may not exceed nine years.

Dividends

We distribute dividends to our shareholders in proportion to the number of shares owned by each shareholder. Our common shares represented by the ADSs have the same dividend rights as other outstanding common shares. For a detailed discussion of our dividend policy, see “Item 8.A. Consolidated Statements and Other Financial Information — Dividends.”

Distribution of Free Shares

In addition to paying dividends in shares out of our retained or current earnings, we may also distribute to our shareholders an amount transferred from our capital surplus or legal reserve to our stated capital in the form of free shares. We must distribute such free shares to all of our shareholders in proportion to their existing shareholdings.

Preemptive Rights and Issuance of Additional Shares

We may at times issue authorized but unissued shares, unless otherwise provided in the Korean Commercial Code, on terms determined by our board of directors. All of our shareholders are generally entitled to subscribe to any newly-issued shares in proportion to their existing shareholdings. We must offer new shares on uniform terms to all shareholders who have preemptive rights and are listed on our shareholders’ registry as of the relevant record date. We must give public notice of the preemptive rights regarding new shares and their transferability at least two weeks before the relevant record date. Our board of directors may determine how to distribute shares for which preemptive rights have not been exercised or where fractions of shares occur.

Under the Korean Commercial Code and our articles of incorporation, we may issue new shares pursuant to a board resolution to persons other than existing shareholders only if (1) the new shares are issued for the purpose of issuing depositary receipts in accordance with the relevant regulations or through an offering to public investors and (2) the purpose of such issuance is deemed necessary by us to achieve a business purpose, including, but not limited to, the introduction of new technology or the improvement of our financial condition. If we make an allotment of new shares to persons other than our existing shareholders, we are required by the Korean Commercial Code to notify our existing shareholders of (a) the class and number of new shares, (b) the issuance price of new shares and the date set for the payment thereof, (c) in cases of no par value shares, the amount to be included in the paid-up capital out of the issuance price of new shares and (d) the method of subscription to new shares by no later than two weeks before the date of payment of the subscription price, or publicly announce such information. Under our articles of incorporation, only our board of directors is authorized to set the terms and conditions with respect to such issuance of new shares.

In addition, under our articles of incorporation, we may issue convertible bonds or bonds with warrants, each up to an aggregate principal amount of Won 400.0 billion, to persons other than existing shareholders,

where such issuance is deemed necessary by us to achieve a business purpose, including, but not limited to, the introduction of new technology or the improvement of our financial condition.

Members of our employee stock ownership association, whether or not they are our shareholders, generally have a preemptive right to subscribe for up to 20.0% of the shares publicly offered pursuant to the FSCMA. This right is exercisable only to the extent that the total number of shares so acquired and held by members of our employee stock ownership association does not exceed 20.0% of the sum of the number of shares then outstanding and the number of newly-issued shares.

General Meeting of Shareholders

We generally hold the annual general meetings of shareholders within three months after the end of each fiscal year. Subject to a board resolution or court approval, we may hold an extraordinary general meeting of shareholders:

•

as necessary;

•

at the request of holders of an aggregate of 3.0% or more of our outstanding common shares;

•

at the request of shareholders holding an aggregate of 1.5% or more of our outstanding shares and preferred shares for at least six months; or

•

at the request of our audit committee.

Holders of non-voting preferred shares may request a general meeting of shareholders only after the non-voting shares become entitled to vote or “enfranchised,” as described under “— Voting Rights” below.

We must give shareholders written notice setting out the date, place and agenda of the meeting at least two weeks before the date of the general meeting of shareholders. However, for holders of less than 1.0% of the total number of issued and outstanding voting shares, we may give notice by placing at least two public notices in at least two daily newspapers at least two weeks in advance of the meeting. Currently, we use The Korea Economic Daily News and Maeil Business Newspaper, both published in Seoul, for this purpose, but we may give notice in the future through electronic means. Shareholders who are not on the shareholders’ registry as of the record date are not entitled to receive notice of the general meeting of shareholders or attend or vote at the meeting. Holders of non-voting preferred shares, unless enfranchised, are not entitled to receive notice of or vote at general meetings of shareholders.

Our general meetings of shareholders have historically been held in or near Seoul.

Voting Rights

Holders of our common shares are entitled to one vote for each common share, except that voting rights of common shares held by us (including treasury shares and shares held by bank trust funds controlled by us), or by a corporate shareholder in which we own more than 10.0% equity interest, either directly or indirectly, may not be exercised. The Korean Commercial Code, unless otherwise stated in the articles of incorporation, permits cumulative voting, which would allow each shareholder to have multiple voting rights corresponding to the number of directors to be appointed in the voting and to exercise all voting rights cumulatively to elect one director. Our articles of incorporation do not permit cumulative voting for the election of directors.

Our shareholders may adopt resolutions at a general meeting by an affirmative majority vote of the voting shares present or represented at the meeting if such affirmative votes also represent at least one-fourth of our total voting shares then issued and outstanding. However, under the Korean Commercial Code and our articles of incorporation, the following matters, among others, require approval by the holders of at least two-thirds of the

voting shares present or represented at a meeting, and such affirmative votes must also represent at least one-third of our total voting shares then issued and outstanding:

•

amending our articles of incorporation;

•

removing a director;

•

effecting any dissolution, merger or consolidation of us;

•

transferring the whole or any significant part of our business;

•

effecting our acquisition of all of the business of any other company or a part of the business of any other company having a material effect on our business;

•

reducing our capital; or

•

issuing any new shares at a price lower than their par value.

In general, holders of non-voting preferred shares are not entitled to vote on any resolution or receive notice of any general meeting of shareholders.

However, in case of amendments to our articles of incorporation, or any merger or consolidation of us, or in some other cases which affect the rights or interests of the non-voting preferred shares, approval of the holders of non-voting preferred shares is required. We may obtain the approval by a resolution of holders of at least two-thirds of the non-voting preferred shares present or represented at a class meeting of the holders of non-voting preferred shares, where the affirmative votes also represent at least one-third of our total issued and outstanding non-voting shares. In addition, if we are unable to pay dividends on non-voting preferred shares as provided in our articles of incorporation, the holders of non-voting shares will become enfranchised and will be entitled to exercise voting rights beginning at the next general meeting of shareholders to be held after the declaration of non-payment of dividends is made until such dividends are paid. The holders of enfranchised non-voting preferred shares will have the same rights as holders of common shares to request, receive notice of, attend and vote at a general meeting of shareholders.

Shareholders may exercise their voting rights by proxy. A shareholder may give proxies only to another shareholder, except that a corporate shareholder may give proxies to its officers or employees.

Holders of ADRs may exercise their voting rights through the ADR depositary, an agent of which is the record holder of the underlying common shares. Subject to the provisions of the deposit agreement, ADR holders are entitled to instruct the ADR depositary how to vote our common shares underlying their ADSs.

Limitation on Shareholdings

The Telecommunications Business Act prohibits foreign governments, individuals, and entities (including Korean entities that are deemed foreigners, as discussed below) from owning more than 49.0% of our voting stock, subject to certain exceptions. See “Item 4.B. Business Overview — Foreign Ownership and Investment Restrictions and Requirements.” Korean entities whose largest shareholder is a foreign government or a foreigner (together with any of its related parties) that owns 15.0% or more of such Korean entities’ outstanding voting stock are deemed foreigners. A foreigner who has acquired shares of our voting stock in excess of such limitation may not exercise the voting rights with respect to the shares exceeding such limitation and may be subject to the MSIT’s corrective orders.

Rights of Dissenting Shareholders

Under Financial Investment Services and Capital Market Act, in some limited circumstances, including the transfer of all or a significant part of our business or our merger or consolidation with another company (with

certain exceptions), dissenting shareholders have the right to require us to purchase their shares. To exercise this right, shareholders, including holders of non-voting shares, must submit to us a written notice of their intention to dissent before the general meeting of shareholders. Then, within 20 days after the relevant resolution is passed at a meeting, the dissenting shareholders must request us in writing to purchase their shares. We are obligated to purchase the shares of such dissenting shareholders within one month after the expiration of the 20-day period. The purchase price for the shares is required to be determined through negotiation between the dissenting shareholders and us. If we cannot agree on a price through negotiation, the purchase price will be the average of (1) the weighted average of the daily share prices on the KRX KOSPI Market for the two-month period before the date of the adoption of the relevant board resolution, (2) the weighted average of the daily share price on the KRX KOSPI Market for the one month period before the date of the adoption of the relevant resolution and (3) the weighted average of the daily share price on the KRX KOSPI Market for the one week period before the date of the adoption of the relevant resolution. However, a court may determine the purchase price if we or dissenting shareholders do not accept the purchase price.

Registry of Shareholders and Record Dates

Our transfer agent, Kookmin Bank, maintains the register of our shareholders at its office in Seoul, Korea. The transfer agent records and registers transfers of shares onto the register of shareholders.

For the purpose of determining the shareholders who are entitled to stock dividends, we may set a record date with at least two weeks’ prior public notice by a resolution of our board of directors.

Annual Report

When sending a written notice for the general meeting of shareholders, we must attach our annual report prepared under the FSCMA and audit report prepared under the Act on External Audit of Stock Companies. Alternatively, we may inform the shareholders of the annual report and audit report by email or uploading them to our website one week before the general meeting of shareholders. Furthermore, at least one week before the annual general meeting of shareholders, we must make our business reports and audited non-consolidated financial statements available for inspection at our principal office and at all of our branch offices. In addition, copies of business reports, the audited non-consolidated financial statements and any resolutions adopted at the general meeting of shareholders will be available to our shareholders.

Under the FSCMA, we must file with the FSC and the Korea Exchange (1) an annual report within 90 days after the end of our fiscal year, (2) a mid-year report within 45 days after the end of the first six months of our fiscal year and (3) quarterly reports within 45 days after the end of the third month and the ninth month of our fiscal year. Copies of these reports are or will be available for public inspection at the FSC and the Korea Exchange.

Transfer of Shares

Under the Korean Commercial Code and the Act on Electronic Registration of Stocks, Bonds, etc., the transfer of shares is effected by registration on the electronic registration ledger. However, to assert shareholders’ rights against us, the transferee must have his or her name, seal and address registered on our registry of shareholders, maintained by our transfer agent. A non-Korean shareholder may file a sample signature in place of a seal, unless he or she is a citizen of a country with a sealing system similar to that of Korea. In addition, a non-resident shareholder must appoint an agent in Korea authorized to receive notices on his or her behalf and file his or her mailing address in Korea.

Under current Korean regulations, the Korea Securities Depository, foreign exchange banks (including domestic branches of foreign banks), financial investment companies with a dealing, brokerage or collective

investment license and internationally recognized custodians may act as agents and provide related services for foreign shareholders. Certain foreign exchange controls and securities regulations apply to the transfer of shares by non-residents or non-Korean citizens. See “Item 10.D. Exchange Controls — Korean Foreign Exchange Controls and Securities Regulations.”

Our transfer agent is Kookmin Bank, located at 24, Gukjegeumyung-ro, Yeongdeungpo-gu, Seoul, Korea.

Restrictions Applicable to Shares

Pursuant to the Telecommunications Business Act, the maximum aggregate foreign shareholding in us is limited to 49.0%. See “Item 4.B. Business Overview — Law and Regulation — Foreign Ownership and Investment Restrictions and Requirements.” In addition, certain foreign exchange controls and securities regulations apply to the acquisition of securities by non-residents or non-Korean citizens. See “Item 10.D. Exchange Controls — Korean Foreign Exchange Controls and Securities Regulations.”

Acquisition of Shares by Us

We may acquire our own shares pursuant to an approval at the general meeting of shareholders, through purchases on the Korea Exchange or a tender offer, or by acquiring the interests in a trust account holding our own shares through agreements with trust companies and asset management companies. The aggregate purchase price for the shares may not exceed the total amount available for distribution as dividends as of the end of the preceding fiscal year less the amount of dividends and mandatory reserves required to be set aside for that fiscal year, subject to certain procedural requirements.

Under the Korean Commercial Code, we may resell or transfer any shares acquired by us to a third party pursuant to an approval by the Board of Directors. In general, corporate entities in which we own a 50.0% or more equity interest may not acquire our common stock. Under the FSCMA, we are subject to certain selling restrictions with respect to the shares acquired by us.

Liquidation Rights

In the event of our liquidation, assets remaining after payment of all debts, liquidation expenses and taxes will be distributed among shareholders in proportion to their shareholdings. Holders of non-voting preferred shares have no preference in liquidation. Holders of debt securities have no preference over other creditors in the event of liquidation.

Item 10.C.

Material Contracts

We have not entered into any material contracts during the two years immediately preceding the date of this annual report, other than in the ordinary course of our business. For information regarding our agreements and transactions with entities affiliated with the SK Group, see “Item 7.B. Related Party Transactions” and note 35 of the notes to our consolidated financial statements. For a description of certain agreements entered into during the past three years related to our capital commitments and obligations, see “Item 5.B. Liquidity and Capital Resources.”

Item 10.D.

Exchange Controls

Korean Foreign Exchange Controls and Securities Regulations

General

The Foreign Exchange Transactions Act and the Presidential Decree and regulations under that Act and Decree, collectively referred to as the “Foreign Exchange Transaction Laws,” regulate investments in Korean

securities by non-residents and issuances of securities outside Korea by Korean companies. Non-residents may invest in Korean securities pursuant to the Foreign Exchange Transaction Laws. The FSC has also adopted, pursuant to its authority under the FSCMA, regulations that restrict investments by foreigners in Korean securities and regulate issuances of securities outside Korea by Korean companies.

Subject to certain limitations, the MOFE has the authority to take the following actions under the Foreign Exchange Transaction Laws:

•

if the Government deems it necessary on account of war, armed conflict, natural disaster or grave and sudden and significant changes in domestic or foreign economic circumstances or similar events or circumstances, the MOFE may temporarily suspend performance under any or all foreign exchange transactions, in whole or in part, to which the Foreign Exchange Transaction Laws apply (including suspension of payment and receipt of foreign exchange), impose an obligation to deposit, safe-keep or sell any means of payment to The Bank of Korea, a foreign exchange stabilization fund, certain other governmental agencies or financial companies or impose an obligation on a resident that holds a claim against a non-resident to collect such claim to enable the recovery of the relevant debt back to Korea; and

•

if the Government concludes that the international balance of payments and international financial markets are experiencing or are likely to experience significant disruption or that the movement of capital between Korea and other countries are likely to adversely affect the Won, exchange rate or other macroeconomic policies, the MOFE may take action to require any person who intends to effect or effects a capital transaction to deposit all or a portion of the means of payment acquired in such transactions with The Bank of Korea, a foreign exchange stabilization fund, certain other governmental agencies or financial companies.

Under the regulations of the FSC amended on February 4, 2009, (1) if a company listed on the KRX KOSPI Market or a company listed on the KRX KOSDAQ Market has submitted a public disclosure of material matters to a foreign financial investment supervisory authority pursuant to the laws of the foreign jurisdiction, then it must submit a copy of the public disclosure and a Korean translation thereof to the FSC and the Korea Exchange, and (2) if a KRX KOSPI Market-listed company or KRX KOSDAQ Market-listed company is approved for listing on a foreign stock market or determined to be de-listed from the foreign stock market or actually listed on, or de-listed from a foreign stock market, then it must submit a copy of any document, which it submitted to or received from the relevant foreign government, foreign financial investment supervisory authority or the foreign stock market, and a Korean translation thereof to the FSC and the Korea Exchange.

Government Review of Issuances of ADSs

In order for us to issue ADSs in excess of US$50 million, we are required to submit a report to the MOFE with respect to the issuance of the ADSs prior to and after such issuance; provided that such US$50 million threshold amount would be reduced by the aggregate principal amount of any foreign currency loans borrowed, and any securities offered and issued, outside Korea during the one-year period immediately preceding the report’s submission date; provided further that when calculating this principal amount, any borrowing of funds or issuance of securities for the purpose of overseas usage shall be excluded. The MOFE may at its discretion direct us to take necessary measures to avoid exchange rate fluctuation in connection with its acceptance of report of the issuance of the ADSs.

•

Under current Korean laws and regulations, the depositary is required to obtain our prior consent for any proposed deposit of common shares if the number of shares to be deposited in such proposed deposit exceeds the number of common shares initially deposited by us for the issuance of ADSs (including deposits in connection with the initial and all subsequent issuances of ADSs by us or with our consent and stock dividends or other distributions related to the ADSs).

•

In addition to such restrictions under Korean laws and regulations, there are also restrictions on the deposits of our common shares for issuance of ADSs. Therefore, a holder of ADRs who surrenders ADRs and withdraws shares may not be permitted subsequently to deposit those shares and obtain ADRs.

We submitted a report to and obtained acceptance thereof by the MOFE for the issuance of ADSs up to an amount corresponding to 24,321,893 common shares. No additional Korean governmental approval is necessary for the issuance of ADSs except that if the total number of our common shares on deposit for conversion into ADSs exceeds 24,321,893 common shares, we may be required to file a report to and obtain acceptance thereof by the MOFE with respect to the increase of such limit and the issuance of additional ADSs.

Reporting Requirements for Holders of Substantial Interests

Under the FSCMA, any person whose direct or beneficial ownership of shares with voting rights, certificates representing the rights to subscribe for shares and equity-related debt securities including convertible bonds and bonds with warrants (collectively referred to as “equity securities”), together with the equity securities beneficially owned by certain related persons or by any person acting in concert with the person, accounts for 5.0% or more of the total outstanding equity securities is required to report the status and purpose (in terms of whether the purpose of shareholding is to affect control over management of the issuer) of the holdings to the FSC and the Korea Exchange within five business days after reaching the 5.0% ownership interest threshold and promptly deliver a copy of such report to the issuer. In addition, any change (1) in the ownership interest subsequent to the report which equals or exceeds 1.0% of the total outstanding equity securities, or (2) in the shareholding purpose is required to be reported to the FSC and the Korea Exchange within five business days from the date of the change. However, the reporting deadline of such reporting requirement is extended for (1) certain professional investors, as specified under the FSCMA, or (2) persons who hold shares for purposes other than management control by up to the tenth day of the month immediately following the last month of the quarter in which the share acquisition or change in their shareholding occurred. Those who reported the purpose of shareholding is to affect control over management of the issuer are prohibited from exercising their voting rights and acquiring additional shares for five days subsequent to the report under the FSCMA.

Violation of these reporting requirements may subject a person to criminal sanctions such as fines or imprisonment and may result in a loss of voting rights with respect to the ownership of unreported equity securities exceeding 5.0%. Furthermore, the FSC may issue an order to dispose of such non-reported equity securities.

In addition to the reporting requirements described above, any person whose direct or beneficial ownership of our common shares accounts for 10.0% or more of the total issued and outstanding shares with voting rights (a “major shareholder”) must report the status of his or her shareholding to the Securities and Futures Commission and the Korea Exchange within five business days after he or she becomes a major shareholder. In addition, any change in the ownership interest subsequent to the report must be reported to the Securities and Futures Commission and the Korea Exchange by the fifth business day of any changes in his or her shareholding. Violations of these reporting requirements may subject a person to criminal sanctions, such as fines or imprisonment.

Furthermore, pursuant to the Enforcement Decree of the FSCMA, a major shareholder must report his or her trading plan to the Securities and Futures Commission and the Korea Exchange at least 30 days prior to the trading The enforcement of such reporting obligations became effective on July 24, 2024.

Restrictions Applicable to ADSs

No Korean governmental approval is necessary for the sale and purchase of ADSs in the secondary market outside Korea or for the withdrawal of shares underlying ADSs and the delivery of shares in Korea in connection

with the withdrawal. The acquisition of the shares by a foreigner must be reported by the foreigner or his or her standing proxy in Korea immediately to the Governor (the “Governor”) of the Financial Supervisory Service of Korea (the “FSS”).

Persons who have acquired shares as a result of the withdrawal of shares underlying the ADSs may exercise their preemptive rights for new shares, participate in free distributions and receive dividends on shares without any further governmental approval.

In addition, we are required to file a securities registration statement with the FSC and such securities registration statement has to become effective pursuant to the FSCMA in order for us to issue shares represented by ADSs, except in certain limited circumstances.

Restrictions Applicable to Shares

As a result of amendments to the Foreign Exchange Transaction Laws and the regulations of the FSC, together referred to as the “Investment Rules,” adopted in connection with the stock market opening from January 1992 and after that date, foreigners may invest, with limited exceptions and subject to procedural requirements, in all shares of Korean companies, whether listed on the KRX KOSPI Market or the KRX KOSDAQ Market, unless prohibited by specific laws. Foreign investors may trade shares listed on the KRX KOSPI Market or the KRX KOSDAQ Market only through the KRX KOSPI Market or the KRX KOSDAQ Market, except in limited circumstances, including, among others:

•

odd-lot trading of shares;

•

acquisition of shares by a foreign company as a result of a merger;

•

acquisition or disposal of shares in connection with a tender offer;

•

acquisition of shares by exercise of warrant, conversion right under convertible bonds, exchange right under exchangeable bonds or withdrawal right under depositary receipts issued outside of Korea by a Korean company (“converted shares”);

•

acquisition of shares through exercise of rights under securities issued outside of Korea;

•

acquisition of shares as a result of inheritance, donation, bequest or exercise of shareholders’ rights, including preemptive rights or rights to participate in free distributions and receive dividends;

•

over-the-counter transactions between foreigners of a class of shares for which the ceiling on aggregate acquisition by foreigners, as explained below, has been reached or exceeded;

•

acquisition of shares by direct investment (including de facto direct investment) under the Foreign Investment Promotion Law;

•

acquisition and disposal of shares on an overseas stock exchange market, if such shares are simultaneously listed on the KRX KOSPI Market or KRX KOSDAQ Market and such overseas stock exchange;

•

arm’s length transactions between foreigners in the event all such foreigners belong to an investment group managed by the same person; and

•

transactions between foreigners outside the securities market and alternative trading systems which do not result in a change in the substantive ownership of the securities.

For over-the-counter transactions of shares between foreigners outside the KRX KOSPI Market or the KRX KOSDAQ Market for shares with respect to which the limit on aggregate foreign ownership has been reached or exceeded, a financial investment company with a brokerage license in Korea must act as an intermediary. Odd-lot trading of shares outside the KRX KOSPI Market or the KRX KOSDAQ Market must involve a

financial investment company with a dealing license in Korea as the other party. Foreign investors are prohibited from engaging in margin transactions through borrowing shares from financial investment companies with respect to shares which are subject to a foreign ownership limit.

The Investment Rules previously required a foreign investor who wished to invest in shares for the first time on the KRX KOSPI Market or the KRX KOSDAQ Market (including converted shares) and shares being publicly offered for initial listing on the KRX KOSPI Market or the KRX KOSDAQ Market to register its identity with the FSS prior to making any such investment. Upon registration, the FSS issued an investment registration certificate (the “IRC”), also referred to as a “foreign investment ID,” to the foreign investor, and the foreign investor was required to present the IRC each time he or she opened a brokerage account with a financial investment company or financial institution in Korea. Foreigners eligible to obtain IRCs included foreign nationals who had not been residing in Korea for a consecutive period of six months or longer, foreign governments, foreign municipal authorities, foreign public institutions, international financial institutions or similar international organizations, corporations incorporated under foreign laws and any person in any additional category designated by decree promulgated under the FSCMA. All Korean offices of a foreign corporation as a group were treated as a separate foreigner from the offices of the corporation outside Korea for the purpose of investment registration.

However, the IRC requirement was abolished on June 13, 2023. Recent amendments to the Investment Rules now permit a foreign investor to trade shares listed on the KRX KOSPI Market or the KRX KOSDAQ Market by providing its Legal Entity Identifier (“LEI”) (in case of corporate entities) or his or her passport number (in case of individuals) to a local securities broker and open a securities account. Foreign investors who have already obtained IRCs can continue to use them for purposes of trading shares listed on the KRX KOSPI Market or the KRX KOSDAQ Market.

If a foreign investor acquires or sells shares outside the KRX KOSPI Market and the KRX KOSDAQ Market, such acquisition or sale of shares must be reported by the foreign investor or such foreign investor’s standing proxy to the Governor at the time of each such acquisition or sale; provided, however, that a foreign investor must ensure that any acquisition or sale of shares outside the KRX KOSPI Market or the KRX KOSDAQ Market in the case of trades in connection with a tender offer, odd-lot trading of shares or trades of a class of shares for which the aggregate foreign ownership limit has been reached or exceeded, is reported to the Governor by the Korea Securities Depository, financial investment companies with a dealing or brokerage license or securities finance companies engaged to facilitate such transaction. In the event a foreign investor desires to acquire or sell shares outside the KRX KOSPI Market or the KRX KOSDAQ Market and the circumstances in connection with such sale or acquisition do not fall within the exceptions made for certain limited circumstances described above, then the foreign investor must obtain the prior approval of the Governor. In addition, in the event a foreign investor acquires or sells shares outside the KRX KOSPI Market or the KRX KOSDAQ Market, a prior report to the Bank of Korea may also be required in certain circumstances. A foreign investor must appoint one or more standing proxies among the Korea Securities Depository, foreign exchange banks (including domestic branches of foreign banks), financial investment companies with a dealing, brokerage or collective investment license and certain eligible foreign custodians which will act as a standing proxy to exercise shareholders’ rights, or perform any matters related to the foregoing activities if the foreign investor does not perform these activities himself. Generally, a foreign investor may not permit any person, other than his, her or its standing proxy, to exercise rights relating to its shares or perform any tasks related thereto on his, her or its behalf. However, a foreign investor may be exempted from complying with these standing proxy rules with the approval of the Governor in cases deemed inevitable by reason of conflict between laws of Korea and the home country of the foreign investor.

Shares of Korean companies must be electronically registered with an eligible custodian in Korea, except in cases where physical security is necessary for the exercise of securities rights or for physical inspections. The Korea Securities Depository, foreign exchange banks (including domestic branches of foreign banks), financial investment companies with a dealing, brokerage or collective investment license and certain eligible foreign custodians are eligible to act as a custodian of shares for a non-resident or foreign investor.

100

Under the Investment Rules, with certain exceptions, foreign investors may acquire shares of a Korean company without being subject to any foreign investment ceiling. As two such exceptions, designated public corporations are subject to (i) a 40.0% ceiling on the acquisition of shares by foreigners in the aggregate and (ii) unless the corporations’ articles of incorporation set a lower threshold, a 3.0% ceiling on the acquisition of shares by a single foreign individual or entity. Currently, Korea Electric Power Corporation is the only designated public corporation, but it has not set a lower threshold for ownership by a single foreign individual or entity. Furthermore, an investment by a foreign investor of not less than 10.0% of the outstanding shares with voting rights of a Korean company is defined as a direct foreign investment under the Foreign Investment Promotion Law, which is, in general, subject to the report to, and acceptance by, the Ministry of Trade, Industry and Energy of Korea, which delegates its authority to foreign exchange banks or the Korea Trade-Investment Promotion Agency under the relevant regulations. The acquisition of our shares by a foreign investor is also subject to the restrictions prescribed in the Telecommunications Business Act. The Telecommunications Business Act generally limits the maximum aggregate foreign shareholdings in us to 49.0% of the outstanding shares. A foreigner who has acquired shares in excess of such restriction described above may not exercise the voting rights with respect to the shares exceeding such limitations and may be subject to corrective orders.

Under the Foreign Exchange Transaction Laws, a foreign investor who intends to make a portfolio investment in shares of a Korean company listed on the KRX KOSPI Market or the KRX KOSDAQ Market must designate a foreign exchange bank at which he, she or it must open a foreign currency account and a Won account exclusively for stock investments. No approval is required for remittance into Korea and deposit of foreign currency funds in the foreign currency account. Foreign currency funds may be transferred from the foreign currency account at the time required to place a deposit for, or settle the purchase price of, a stock purchase transaction to a Won account opened at a securities company. Funds in the foreign currency account may be remitted abroad without any governmental approval.

Dividends on shares are paid in Won. No governmental approval is required for foreign investors to receive dividends on, or the Won proceeds of the sale of, any such shares to be paid, received and retained in Korea. Dividends paid on, and the Won proceeds of the sale of, any such shares held by a non-resident of Korea must be deposited either in a Won account with the investor’s financial investment companies with a securities dealing, brokerage or collective investment license or the investor’s Won account. Funds in the investor’s Won account may be transferred to such investor’s foreign currency account or withdrawn for local living expenses, provided that any withdrawal of local living expenses in excess of a certain amount is reported to the tax authorities by the foreign exchange bank at which the Won account is maintained. Funds in the investor’s Won account may also be used for future investment in shares or for payment of the subscription price of new shares obtained through the exercise of preemptive rights.

Financial investment companies with a securities dealing, brokerage or collective investment license are allowed to open foreign currency accounts with foreign exchange banks exclusively for accommodating foreign investors’ stock investments in Korea. Through these accounts, these financial investment companies may enter into foreign exchange transactions on a limited basis, such as conversion of foreign currency funds and Won funds, either as a counterparty to or on behalf of foreign investors, without the investors having to open their own accounts with foreign exchange banks.

Item 10.E.

Taxation

United States Taxation

This summary describes certain U.S. federal income tax consequences for a U.S. holder (as defined below) of acquiring, owning, and disposing of common shares or ADSs. This summary applies to you only if you hold our common shares or ADSs as capital assets for tax purposes. This summary does not apply to you if you are a member of a class of holders subject to special rules, such as:

•

a dealer in securities or currencies;

101

•

a trader in securities that elects to use a mark-to-market method of accounting for securities holdings;

•

a bank or other financial institution;

•

a life insurance company;

•

a tax-exempt organization;

•

a person that holds common shares or ADSs that are a hedge or that are hedged against interest rate or currency risks;

•

a person that holds common shares or ADSs as part of a straddle or conversion transaction for tax purposes;

•

a person whose functional currency for tax purposes is not the U.S. dollar;

•

a person that owns or is deemed to own 10.0% or more of any class of our stock (by vote or value); or

•

an entity or arrangement that is treated as a partnership for U.S. federal income tax purposes (or partners therein).

This summary is based on the Internal Revenue Code of 1986, as amended, its legislative history, existing and proposed regulations promulgated thereunder, and published rulings and court decisions, all as currently in effect. These laws are subject to change, possibly on a retroactive basis.

Please consult your own tax advisers concerning the U.S. federal, state, local, and other tax consequences of purchasing, owning, and disposing of common shares or ADSs in your particular circumstances.

For purposes of this summary, you are a “U.S. holder” if you are the beneficial owner of a common share or an ADS and are:

•

a citizen or resident of the United States;

•

a U.S. domestic corporation; or

•

otherwise subject to U.S. federal income tax on a net income basis with respect to income from the common share or ADS.

In general, if you are the beneficial owner of ADSs, you will be treated as the beneficial owner of the common shares represented by those ADSs for U.S. federal income tax purposes, and no gain or loss will be recognized if you exchange an ADS for the common share represented by that ADS.

Dividends

The gross amount of cash dividends that you receive (prior to deduction of Korean taxes) generally will be subject to U.S. federal income taxation as foreign source “passive income” dividend income and will not be eligible for the dividends received deduction. Dividends paid in Won will be included in your income in a U.S. dollar amount calculated by reference to the exchange rate in effect on the date of your receipt of the dividend, in the case of common shares, or the depositary’s receipt, in the case of ADSs, regardless of whether the payment is in fact converted into U.S. dollars. If such a dividend is converted into U.S. dollars on the date of receipt, you generally should not be required to recognize foreign currency gain or loss in respect of the dividend income.

The U.S. dollar amount of dividends received by an individual with respect to the ADSs will be subject to taxation at a preferential rate if the dividends are “qualified dividends.” Subject to certain exceptions for short-term and hedged positions, dividends paid on the ADSs will be treated as qualified dividends if (1) the ADSs are readily tradable on an established securities market in the United States and (2) we were not, in the year prior to the year in which the dividend was paid, and are not, in the year in which the dividend is paid, a passive foreign

102

investment company (“PFIC”), as discussed below under “ —Passive Foreign Investment Company Rules.” The ADSs are listed on the NYSE and will qualify as readily tradable on an established securities market in the United States so long as they are so listed. As described below under “ —Passive Foreign Investment Company Rules,” we do not believe that we were classified as a PFIC with respect to our taxable years ending December 31, 2024 and 2025. We do not expect to be classified as a PFIC for the current taxable year or in the reasonably foreseeable future based on the present composition of our income and assets and our expectations regarding our income and assets in the future. Accordingly, U.S. holders of commons shares or ADSs should consult their own tax advisors regarding the availability of the reduced dividend tax rate for dividends with respect to our common shares or ADSs.

Distributions of additional shares in respect of common shares or ADSs that are made as part of a pro-rata distribution to all of our stockholders generally will not be subject to U.S. federal income tax.

Sale or Other Disposition

Subject to the discussion below under “ —Passive Foreign Investment Company Rules,” for U.S. federal income tax purposes, gain or loss you realize on a sale or other disposition of common shares or ADSs generally will be treated as U.S. source capital gain or loss, and will be long-term capital gain or loss if the common shares or ADSs were held for more than one year. Your ability to offset capital losses against ordinary income is limited. Long-term capital gain recognized by an individual U.S. holder generally is subject to taxation at reduced rates.

Passive Foreign Investment Company Rules

Special U.S. tax rules apply to investors in companies that are considered to be PFICs. We will be classified as a PFIC in a particular taxable year if either (i) 75 percent or more of our gross income for the taxable year is passive income; or (ii) 50 percent or more of the value of our assets (generally determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income. Investments in companies in which we own less than 25 percent of the stock (by value) are considered to be assets that produce passive income.

The determination whether we are a PFIC is made annually based on the particular facts and circumstances, such as the composition of our income and the valuation of our assets. We do not believe that we were classified as a PFIC with respect to our taxable years ending December 31, 2024 and 2025. We do not expect to be classified as a PFIC for the current taxable year or in the reasonably foreseeable future, based on the present composition of our income and assets and our expectations regarding our income and assets in the future. Stock market volatility could exacerbate these considerations. See “Item 3.D. Risk Factors — Risks Relating to Korea — Unfavorable financial and economic developments in Korea may have an adverse effect on us.”

You should consult your own tax advisors regarding our classification as a PFIC for 2024, 2025 or in the current or future years.

If we are classified as a PFIC, and you do not make a mark-to-market election, as described in the following paragraph, you will be subject to a special tax at ordinary income tax rates on “excess distributions” (generally, any distributions that you receive in a taxable year that are greater than 125 percent of the average annual distributions that you have received in the preceding three taxable years, or your holding period, if shorter), including gain that you recognize on the sale of your common shares or ADSs. The amount of income tax on any excess distributions will be increased by an interest charge to compensate for tax deferral, calculated as if the excess distributions were earned ratably over the period you hold your common shares or ADSs. Classification as a PFIC may also have other adverse tax consequences, including, in the case of individuals, the denial of a step-up in the basis of your common shares or ADSs at death.

103

Although the determination of whether we are a PFIC is made annually, if we are a PFIC for any taxable year during which a U.S. holder holds our common shares or ADSs, such U.S. holder will generally be subject to the unfavorable rules described above for that year and for each subsequent year in which such U.S. holder holds the common shares or ADSs (even if we do not qualify as a PFIC in such subsequent years). However, if we cease to be a PFIC, a U.S. holder can avoid the continuing impact of the PFIC rules by making a special election to recognize gain as if such U.S. holder’s common shares or ADSs had been sold on the last day of the last taxable year during which we were a PFIC.

A U.S. holder may be able to avoid the unfavorable rules described above by electing to mark its ADSs to market, provided the ADSs are treated as “marketable stock.” The ADSs generally will be treated as marketable stock if the ADSs are “regularly traded” on a “qualified exchange or other market” (which includes the NYSE). Further, it should also be noted that only the ADSs and not the common shares are listed on the NYSE. Consequently, a U.S. holder that holds common shares that are not represented by ADSs may not be eligible to make a mark-to-market election in respect of those common shares. If the U.S. holder makes a mark-to-market election, the U.S. holder will be required in any year in which we are a PFIC to include as ordinary income the excess of the fair market value of its ADSs at year-end over the U.S. holder’s basis in those ADSs. If at the end of the U.S. holder’s taxable year, the U.S. holder’s basis in the common shares or ADSs exceeds their fair market value, the U.S. holder will be entitled to deduct the excess as an ordinary loss, but only to the extent of the U.S. holder’s net mark-to-market gains from previous years. A U.S. holder’s adjusted tax basis in the ADSs will be increased by the amount of any income inclusion and decreased by the amount of any deductions under the mark-to-market rules. In addition, any gain the U.S. holder recognizes upon the sale of the U.S. holder’s ADSs in a year in which we are a PFIC will be taxed as ordinary income in the year of sale, and any loss will be treated as an ordinary loss to the extent of the U.S. holder’s net mark-to-market gains from previous years. If a U.S. holder makes a mark-to-market election, it will be effective for the taxable year for which the election is made and all subsequent taxable years unless the ADSs are no longer regularly traded on a “qualified exchange or other market” or the Internal Revenue Service (“IRS”) consents to the revocation of the election. If a U.S. holder makes a mark-to-market election in respect of a corporation classified as a PFIC and such corporation ceases to be classified as a PFIC, the U.S. holder will not be required to take into account the mark-to-market gain or loss described above during any period that such corporation is not classified as a PFIC. Because a mark-to-market election generally cannot be made for any lower-tier PFICs that we may own (unless shares of such lower-tier PFIC are themselves “marketable”), a U.S. holder who makes a mark-to-market election with respect to our common shares may continue to be subject to the general PFIC rules with respect to such U.S. holder’s indirect interest in any of our non-United States subsidiaries that is classified as a PFIC. U.S. holders are urged to consult their own tax advisors about the availability of the mark-to-market election, the consequences of not making a mark-to-market election for the first year during which a U.S. holder holds interests in our common shares or ADSs and we are a PFIC, and whether making the election would be advisable in their particular circumstances.

Although a U.S. holder can also avoid the unfavorable PFIC rules described above by electing to treat its common shares or ADSs as interests in a qualified electing fund (“QEF”), we do not intend to provide the information that would allow a U.S. holder to make such an election. Accordingly, in the event that we are treated as a PFIC, a U.S. holder will not be able to make a “QEF election.”

A U.S. holder that owns an equity interest in a PFIC must annually file IRS Form 8621 and may be required to file other IRS forms. A failure to file one or more of these forms as required may toll the running of the statute of limitations in respect of each of the U.S. holder’s taxable years for which such form is required to be filed. As a result, the taxable years with respect to which the U.S. holder fails to file the form may remain open to assessment by the IRS indefinitely, until the form is filed.

The U.S. federal income tax rules relating to PFICs are complex. U.S. holders are strongly urged to consult their own tax advisors regarding our potential classification as a PFIC and regarding the U.S. federal income tax consequences of acquiring, holding and disposing of our common shares or ADSs if we are so classified, including the advisability of making a mark-to-market election, if available.

104

Foreign Tax Credit Considerations

You should consult your own tax advisers to determine whether you are subject to any special rules that limit your ability to make effective use of foreign tax credits, including the possible adverse impact of failing to take advantage of benefits under the income tax treaty between the United States and Korea (the “Treaty”).

Subject to generally applicable limitations and conditions, Korean withholding tax imposed on dividends paid at the appropriate rate applicable to a U.S. holder may be eligible for a credit against such U.S. holder’s U.S. federal income tax liability. These generally applicable limitations and conditions include requirements adopted by the IRS in regulations promulgated in December 2021 and any Korean tax will need to satisfy these requirements in order to be eligible to be a creditable tax for a U.S. holder. In the case of a U.S. holder that consistently elects to apply a modified version of these rules under temporary guidance and complies with specific requirements set forth in such guidance, the Korean tax on dividends will be treated as meeting the requirements and therefore as a creditable tax. In the case of all other U.S. holders, the application of these requirements to the Korean tax on dividends is uncertain and we have not determined whether these requirements are met. If the Korean tax is not a creditable tax for a U.S. holder or the U.S. holder does not elect to claim a foreign tax credit for any foreign income taxes paid or accrued in the same taxable year, the U.S. holder may be able to deduct the Korean tax in computing such U.S. holder’s taxable income for U.S. federal income tax purposes. Dividends will constitute income from sources without the United States and, if such withholding tax is a creditable tax for a U.S. holder that elects to claim foreign tax credits, generally will constitute “passive category income” for foreign tax credit purposes.

Gain, if any, realized by a U.S. holder on the sale or other disposition of the common shares or ADSs generally will be treated as U.S. source income for U.S. foreign tax credit purposes. A U.S. holder that is eligible for, and properly elects, the benefits of the Treaty, will generally not be subject to Korean withholding tax on capital gains. If a U.S. holder is not eligible for benefits under the Treaty and is therefore subject to Korean withholding tax on capital gains, the U.S. holder generally will not be entitled to credit any Korean tax imposed on the sale or other disposition of the shares against such U.S. holder’s U.S. federal income tax liability, except in the case of a U.S. holder that consistently elects to apply a modified version of the U.S. foreign tax credit rules that is permitted under temporary guidance and complies with the specific requirements set forth in such guidance. Consequently, even if the withholding tax qualifies as a creditable tax, a U.S. holder may not be able to credit the tax against its U.S. federal income tax liability unless such credit can be applied (subject to generally applicable conditions and limitations) against tax due on other income treated as derived from foreign sources. If the Korean tax is not a creditable tax, the tax would reduce the amount realized on the sale or other disposition of the shares even if the U.S. holder has elected to claim a foreign tax credit for other taxes in the same year.

The temporary guidance discussed above also indicates that the U.S. Department of the Treasury and the IRS are considering proposing amendments to the December 2021 regulations and that the temporary guidance can be relied upon until additional guidance is issued that withdraws or modifies the temporary guidance.

Any Korean securities transaction tax or agricultural and fishery special surtax that you pay will not be creditable for foreign tax credit purposes.

The rules with respect to foreign tax credits are complex and U.S. holders should consult their own tax advisors regarding the application of the foreign tax credit rules to their investment in, and disposition of, the common shares or ADSs.

Specified Foreign Financial Assets

Certain U.S. holders that own “specified foreign financial assets” with an aggregate value in excess of US$50,000 on the last day of the taxable year or US$75,000 at any time during the taxable year are generally required to file an information statement along with their tax returns, currently on IRS Form 8938, with respect to

105

such assets. “Specified foreign financial assets” include any financial accounts held at a non-U.S. financial institution, as well as securities issued by a non-U.S. issuer (which would include the common shares or ADSs) that are not held in accounts maintained by financial institutions. Higher reporting thresholds apply to certain individuals living abroad and to certain married individuals. Regulations extend this reporting requirement to certain entities that are treated as formed or availed of to hold direct or indirect interests in specified foreign financial assets based on certain objective criteria. U.S. holders who fail to report the required information could be subject to substantial penalties. Prospective investors should consult their own tax advisers concerning the application of these rules to their investment in the common shares or ADSs, including the application of the rules to their particular circumstances.

U.S. Information Reporting and Backup Withholding Rules

Payments of dividends and sales proceeds that are made within the United States or through certain U.S.-related financial intermediaries are subject to information reporting and may be subject to backup withholding unless the holder (1) is a corporation or other exempt recipient and demonstrates this when required or (2) provides a taxpayer identification number and certifies that no loss of exemption from backup withholding has occurred. Holders that are not a “United States Person” (as defined in the Code) generally are not subject to information reporting or backup withholding. However, such a holder may be required to provide a certification of its non-U.S. status in connection with payments received within the United States or through a U.S.-related financial intermediary.

Korean Taxation

The following is a summary of the principal Korean tax consequences to owners of the common shares or ADSs, as the case may be, who are non-resident individuals or non-Korean corporations without a permanent establishment in Korea to which the relevant income is attributable or with which the relevant income is effectively connected (“Non-resident Holders”). The statements regarding Korean tax laws set forth below are based on the laws in force and as interpreted by the Korean taxation authorities as of the date hereof. This summary is not exhaustive of all possible tax considerations which may apply to a particular investor and potential investors are advised to satisfy themselves as to the overall tax consequences of the acquisition, ownership and disposition of the common shares or ADSs, including specifically the tax consequences under Korean law, the laws of the jurisdiction of which they are resident, and any tax treaty between Korea and their country of residence, by consulting their own tax advisors.

Tax on Dividends

Dividends on the common shares or ADSs paid (whether in cash or in shares) to a Non-resident Holder will be subject to Korean withholding taxes at the rate of 22.0% (including local income tax) or such lower rate as is applicable under a treaty between Korea and such Non-resident Holder’s country of tax residence. Free distributions of shares representing a capitalization of certain capital surplus reserves may be subject to Korean withholding taxes.

The tax is withheld by the payer of the dividend. While it is the payer that is required to withhold the tax, Korean law generally entitles the person who was subject to the withholding of Korean tax to recover from the Government any part of the Korean tax withheld upon providing evidence that it was entitled to have tax withheld at a lower rate if certain conditions are met.

Tax on Capital Gains

As a general rule, capital gains earned by Non-resident Holders upon transfer of the common shares or ADSs are subject to Korean withholding tax at the lower of (1) 11.0% (including local income tax) of the gross proceeds realized or (2) 22.0% (including local income tax) of the net realized gains (subject to the production of satisfactory evidence of the acquisition costs and certain direct transaction costs), unless exempt from Korean income taxation under the effective Korean tax treaty with the Non-resident Holder’s country of tax residence.

106

However, a Non-resident Holder will not be subject to Korean income taxation on capital gains realized upon the sale of the common shares through the KRX KOSPI Market if the Non-resident Holder (1) has no permanent establishment in Korea and (2) did not or has not owned (together with any shares owned by any entity with certain special relationship with such Non-resident Holder) 25.0% or more of the total issued and outstanding shares of us at any time during the calendar year in which the sale occurs and during the five calendar years prior to the calendar year in which the sale occurs.

It should be noted that capital gains earned by you (regardless of whether you have a permanent establishment in Korea) from a transfer of ADSs outside Korea will generally be exempt from Korean income taxation, provided that the ADSs are deemed to have been issued overseas. If and when an owner of the underlying common shares transfers the ADSs following the conversion of the underlying shares for ADSs, such person will not be exempt from Korean income taxation.

Inheritance Tax and Gift Tax

Korean inheritance tax is imposed upon (1) all assets (wherever located) of the deceased if at the time of his death he was a tax resident of Korea and (2) all property located in Korea which passes on death (irrespective of the domicile of the deceased). Gift tax is imposed in similar circumstances to the above. The taxes are imposed if the value of the relevant property is above a certain limit and vary depending on the value of the property and the identity of the parties involved.

Under Korean inheritance and gift tax laws, securities issued by a Korean corporation are deemed to be located in Korea irrespective of where they are physically located or by whom they are owned.

Securities Transaction Tax

Securities transaction tax is imposed on the transfer of shares issued by a Korean corporation or the right to subscribe for such shares generally at the rate of 0.35% of the sales price. In the case of the transfer of shares listed on the KRX KOSPI Market (such as our common shares), the securities transaction tax is imposed generally at the rate of (1) 0.20% of the sales price of such shares (including agricultural and fishery special surtax thereon) for transfers made on or after January 1, 2026 if traded on the KRX KOSPI Market or (2) subject to certain exceptions, 0.35% of the sales price of such shares if traded outside the KRX KOSPI Market.

Securities transaction tax or the agricultural and fishery special surtax is not applicable if (1) the shares or rights to subscribe for shares are listed on a designated foreign stock exchange and (2) the sale of the shares takes place on such exchange.

Securities transaction tax, if applicable, must be paid by the transferor of the shares or rights, in principle. When the transfer is effected through a securities settlement company, such settlement company is generally required to withhold and pay (to the tax authority) the tax, and when such transfer is made through a financial investment company with a brokerage license only, such company is required to withhold and pay the tax. Where the transfer is effected by a Non-resident Holder without a permanent establishment in Korea, other than through a securities settlement company or a financial investment company with a brokerage license, the transferee is required to withhold the securities transaction tax. Failure to do so will result in the imposition of penalties equal to the sum of (1) between 10.0% to 40.0% of the tax amount due, depending on the nature of the improper reporting, and (2) 8.03% per annum on the tax amount due for the default period.

Tax Treaties

Currently, Korea has income tax treaties with a number of countries, inter alia, Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Japan, Luxembourg, Ireland, the Netherlands, New Zealand,

107

Norway, Singapore, Sweden, Switzerland, the United Kingdom and the United States under which the rate of withholding tax on dividend and interest is reduced, generally to between 5.0% and 16.5% (including local income tax), and the tax on capital gains derived by a non-resident from the transfer of securities issued by a Korean company is often eliminated.

Each Non-resident Holder of common shares should inquire for itself whether it is entitled to the benefits of a tax treaty with Korea. It is the responsibility of the party claiming the benefits of a tax treaty in respect of interest, dividend, capital gains or “other income” to submit to us (or our agent), the purchaser or the financial investment company with a brokerage license, as the case may be, prior to or at the time of payment, such evidence of tax residence of the party claiming the treaty benefit as the Korean tax authorities may require in support of its claim for treaty protection. In the absence of sufficient proof, we (or our agent), the purchaser or the financial investment company with a brokerage license, as the case may be, must withhold tax at the normal rates.

Furthermore, in order for a non-resident of Korea to obtain the benefits of tax exemption on certain Korean source income (e.g., capital gains and interest) under an applicable tax treaty, Korean tax law requires such non-resident (or its agent) to submit to the payer of such Korean source income an application for a tax exemption along with a certificate of tax residency of such non-resident issued by a competent authority of the non-resident’s country of tax residence, subject to certain exceptions. The payer of such Korean source income, in turn, is required to submit such application to the relevant district tax office by the ninth day of the month following the date of the first payment of such income.

For a non-resident of Korea to obtain the benefits of treaty-reduced tax rates on certain Korean source income (e.g., capital gains and interest) under an applicable tax treaty, Korean tax law requires such non-resident (or its agents) to submit to the payer of such Korean source income an application for treaty-reduced tax rates prior to receipt of such Korean source income; provided, however, that an owner of ADSs who is a non-resident of Korea is not required to submit such application, if the Korean source income on the ADSs is paid through an account opened at the Korea Securities Depository by a foreign depository. The payer of such Korean source income, in turn, is required to submit such application to the relevant district tax office by the end of February of the year following the date of payment of such income (or, in the case of a temporary suspension or permanent closure of business, by the end of the month following the second month after the month in which such suspension or closure occurs).

At present, Korea has not entered into any tax treaty relating to inheritance or gift tax.

Item 10.F.

Dividends and Paying Agents

Not applicable.

Item 10.G.

Statements by Experts

Not applicable.

Item 10.H.

Documents on Display

We file reports, including annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC that apply to foreign private issuers. You may read and copy any materials filed with the SEC at the Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Any filings we make electronically will be available to the public over the Internet at the SEC’s Website at www.sec.gov.

Documents filed with annual reports and documents filed or submitted to the SEC are also available for inspection at our principal business office during normal business hours. Our principal business office is located at SK T-Tower, 65, Eulji-ro, Jung-gu, Seoul 04539, Korea.

108

Item 10.I.

Subsidiary Information

Not applicable.

Item 10.J.

Annual Report to Security Holders

Not applicable.

Item 11.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to foreign exchange rate and interest rate risk primarily associated with underlying liabilities and to equity price risk as a result of our investment in equity instruments.

We have entered into a floating-to-fixed cross currency interest rate swap contract to hedge foreign currency and interest rate risks with respect to US$300 million of bonds issued in May 2025. In addition, we have entered into fixed-to-fixed cross currency swap contracts to hedge the foreign currency risks of US$400 million of bonds issued in July 2007 and US$300 million of bonds issued in June 2023. Furthermore, we have entered into a floating-to-fixed interest rate swap contract to hedge interest rate risks with respect to Won 200 billion of bonds issued in October 2024. See note 21 of the notes to our consolidated financial statements. We may consider in the future entering into other such transactions solely for hedging purposes.

The following discussion and tables, which constitute “forward looking statements” that involve risks and uncertainties, summarize our market-sensitive financial instruments including fair value, maturity and contract terms. These tables address market risk only and do not present other risks which we face in the normal course of business, including country risk, credit risk and legal risk.

Exchange Rate Risk

Korea is our main market and, therefore, substantially all of our cash flow is denominated in Won. We are exposed to foreign exchange risk related to foreign currency denominated liabilities. These liabilities relate primarily to foreign currency denominated debt, primarily in Dollars. A 10.0% increase in the exchange rate between the Won and all foreign currencies would result in an increase in profit before income tax of Won 11.3 billion, with a decrease of 10.0% in the exchange rate having the opposite effect, as of December 31, 2025. For a further discussion of our exchange rate risk exposures, see note 34(1) of the notes to our consolidated financial statements.

109

Interest Rate Risk

We are also subject to market risk exposure arising from changing interest rates. The following table summarizes the carrying amounts and fair values, maturity and contract terms of our exchange rate and interest sensitive short-term and long-term liabilities as of December 31, 2025:


	Maturities
	2026			2027			2028			2029			2030			Thereafter			Total		Fair Value
	(In billions of Won, except for percentage data)
Local currency:
Fixed-rate	W	1,047.7		W	1,373.2		W	1,157.5		W	583.6		W	1,206.3		W	1,844.7		W	7,212.9	W	7,100.8
Average weighted rate⁽¹⁾		3.17	%		3.28	%		3.59	%		2.77	%		3.00	%		2.75	%
Variable rate		200.0			—			—			—			—			—			200.0		200.0
Average weighted rate⁽¹⁾		2.93	%		—			—			—			—			—

Sub-total		1,247.7			1,373.2			1,157.5			583.6			1,206.3			1,844.7			7,412.9		7,300.8

Foreign currency:
Fixed-rate		—			577.5			427.3			—			—			—			1,004.8		1,087.8
Average weighted rate⁽¹⁾		—			6.57	%		4.88	%		—			—			—
Variable rate		—			—			429.3			—			—			—			429.3		429.3
Average weighted rate⁽¹⁾		—			—			4.79	%		—			—			—

Sub-total		—			577.5			856.6			—			—			—			1,434.1		1,517.1

Total	W	1,247.7		W	1,950.7		W	2,014.1		W	583.6		W	1,206.3		W	1,844.7		W	8,847.0	W	8,817.9

(1)	Weighted average rates of the portfolio at the period end.

A 1.0% point increase in interest rates would result in a decrease in profit before income tax of Won 5.5 billion with a 1.0% point decrease in interest rates having the opposite effect, as of December 31, 2025. For a further discussion of our interest rate risk exposures, see note 34(1) of the notes to our consolidated financial statements.

Equity Price Risk

We are also subject to market risk exposure arising from changes in the equity securities market, which affect the fair value of our equity portfolio. As of December 31, 2025, 2024 and 2023, a 10.0% increase in the equity indices where our equity investments at fair value are listed, with all other variables held constant, would have increased our total equity by Won 71.1 billion, Won 81.4 billion and Won 85.0 billion, respectively, with a 10.0% decrease in the equity index having the opposite effect. The foregoing sensitivity analysis assumes that all variables other than changes in the equity index are held constant, and that our equity investments at fair value through other comprehensive income had moved according to the historical correlation to the index, and as such, does not reflect any correlation between the equity index and other variables. For a further discussion of our equity price risk exposures, see note 34(1) of the notes to our consolidated financial statements.

Item 12.

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Item 12.A.

Debt Securities

Not applicable.

Item 12.B.

Warrants and Rights

Not applicable.

110

Item 12.C.

Other Securities

Not applicable.

Item 12.D.

American Depositary Shares

Fees and Charges under Deposit Agreement

The ADR depositary will charge the party receiving ADSs up to US$5.00 per 100 ADSs (or fraction thereof), provided that the ADR depositary has agreed to waive such fee as would have been payable by us in the case of (1) an offering of ADSs by us or (2) any distribution of shares of common stock or any rights to subscribe for additional shares of common stock. The ADR depositary will not charge the party to whom ADSs are delivered against deposits. The ADR depositary will charge the party surrendering ADSs for delivery of deposited securities up to US$5.00 per 100 ADSs (or fraction thereof) surrendered. The ADR depositary will also charge the party to whom any cash distribution, or for whom the sale or exercise of rights or other corporate action involving distributions to shareholders, is made with respect to ADSs up to US$0.02 per ADS held plus the expenses of the ADR depositary on a per-ADS basis. We will pay the expenses of the ADR depositary and any entity acting as registrar for the shares only as specified in the deposit agreement. The ADR depositary will pay any other charges and expenses of the ADR depositary and the entity acting as registrar for the shares.

Holders of ADRs must pay (1) taxes and other governmental charges, (2) share transfer registration fees on deposits of shares of common stock, (3) such cable, telex, facsimile transmission and delivery expenses as are expressly provided in the deposit agreement to be at the expense of persons depositing shares of common stock or holders of ADRs and (4) such reasonable expenses as are incurred by the ADR depositary in the conversion of foreign currency into Dollars.

Notwithstanding any other provision of the deposit agreement, in the event that the ADR depositary determines that any distribution in property (including shares or rights to subscribe therefor or other securities) is subject to any tax or governmental charges which the ADR depositary is obligated to withhold, the ADR depositary may dispose of all or a portion of such property (including shares and rights to subscribe therefor) in such amounts and in such manner as the ADR depositary deems necessary and practicable to pay such taxes or governmental charges, including by public or private sale, and the ADR depositary will distribute the net proceeds of any such sale or the balance of any such property after deduction of such taxes or governmental charges to the holders of ADSs entitled thereto in proportion to the number of ADSs held by them respectively.

All such charges may be changed by agreement between the ADR depositary and us at any time and from time to time, subject to the deposit agreement. The right of the ADR depositary to receive payment of fees, charges and expenses shall survive the termination of this deposit agreement and, as to any depositary, the resignation or removal of such depositary pursuant to the deposit agreement.

Payments made by ADR Depositary

The ADR depositary reimburses us for certain expenses we incur in connection with our ADR program, subject to certain ceilings. These reimbursable expenses currently include expenses relating to the preparation of SEC filings and submissions, listing fees, education and training fees, corporate action expenses and other miscellaneous fees. In the fiscal year 2025, we received US$106,670.29, net of taxes, from the ADR depositary in connection with such reimbursements.

111

PART II

Item 13.

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.

Item 14.

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

None.

Item 15.

CONTROLS AND PROCEDURES

Our management has evaluated, with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of December 31, 2025. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based upon our evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of such date. Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, as of December 31, 2025. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our consolidated financial statements would be prevented or detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013 framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with IFRS Accounting Standards, as issued by the IASB. Based on our evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2025.

Report of the Independent Registered Public Accounting Firm on the Effectiveness of Our Internal Control Over Financial Reporting

The report of our independent registered public accounting firm, KPMG Samjong Accounting Corp., or KPMG Samjong, on the effectiveness of our internal control over financial reporting as of December 31, 2025 is included in Item 18 of this annual report.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting during 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

112

Item 16.

RESERVED

Item 16A.

AUDIT COMMITTEE FINANCIAL EXPERT

Tay Seop Lim is the chairperson of our audit committee and determined to be an “audit committee financial expert” within the meaning of this Item 16A by the board of directors. The board of directors have further determined that Tay Seop Lim is independent within the meaning of applicable SEC rules and the listing standards of the NYSE. See “Item 6.C. Board Practices — Audit Committee” for additional information regarding our audit committee.

Item 16B.

CODE OF ETHICS

Code of Ethics for Chief Executive Officer, Chief Financial Officer and Controller

We have a code of ethics that applies to our Chief Executive Officer, Chief Financial Officer, senior accounting officers and employees. We also have an internal control and disclosure policy designed to promote full, fair, accurate, timely and understandable disclosure in all of our reports and publicly filed documents. A copy of our code of ethics is available on our website at www.sktelecom.com. If we amend the provisions of our code of ethics that apply to our Chief Executive Officer, Chief Financial Officer and persons performing similar functions, or if we grant any waiver of such provisions, we will disclose such amendment or waiver on our website.

Item 16C.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table sets forth the fees we paid to our current independent registered public accounting firm KPMG Samjong and its affiliates for the year ended December 31, 2025 and our former independent registered public accounting firm EY Han Young (formerly, Ernst & Young Han Young) and its affiliates for the year ended December 31, 2024:


	Year Ended December 31,
	2025		2024
	(In millions of Won)
Audit Fees	W	4,484	W	4,903
Audit-Related Fees		3		—
Tax Fees		886		—
All Other Fees		100		—

Total	W	5,473	W	4,903

“Audit Fees” are the aggregate fees billed by our independent registered public accounting firm for the audit of our consolidated annual financial statements, reviews of interim financial statements and attestation services that are provided in connection with statutory and regulatory filings or engagements.

“Audit-Related Fees” are fees charged by our independent registered public accounting firm for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees.” This category comprises fees billed in 2025 for the verification of the consistency of financial information submitted to the MSIT with our historical financial statements in connection with the reallocation of certain of our frequency usage rights.

“Tax Fees” are fees for professional services rendered by our independent registered public accounting firm for tax compliance, tax advice on actual or contemplated transactions and tax planning services.

“All Other Fees” are fees billed by our independent registered public accounting firm for benchmarking analysis relating to net zero initiatives for the purpose of providing background market information.

113

Pre-Approval of Audit and Non-Audit Services Provided by Independent Registered Public Accounting Firm

Our audit committee pre-approves all audit services to be provided by our independent registered public accounting firm. Our audit committee’s policy regarding the pre-approval of non-audit services to be provided to us by our independent auditors is that all such services shall be pre-approved by our audit committee. Non-audit services that are prohibited to be provided to us by our independent auditors under the rules of the SEC and applicable law may not be pre-approved. In addition, prior to the granting of any pre-approval, our audit committee must be satisfied that the performance of the services in question will not compromise the independence of our independent registered public accounting firm.

Our audit committee did not pre-approve any non-audit services under the de minimis exception of Rule 2-01 (c)(7)(i)(C) of Regulation S-X as promulgated by the SEC.

Item 16D.

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

Item 16E.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

During the fiscal year ended December 31, 2025, we did not make any purchase of our common shares.

Item 16F.

CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

The disclosure called for by paragraph (a) of this Item 16F was previously reported, as that term is defined in Rule 12b-2 under the Exchange Act, in our Annual Report on Form 20-F for the year ended December 31, 2024 (File No. 333-04906), filed on April 29, 2025.

Item 16G.

CORPORATE GOVERNANCE

The following is a summary of the significant differences between the NYSE’s corporate governance standards and those that we follow under Korean law.


NYSE Corporate Governance Standards		Our Corporate Governance Practice

Director Independence
Listed companies must have a majority of independent directors.		Of the eight members of our board of directors, five are independent directors.

Executive Session

Non-management directors must meet in regularly scheduled executive sessions without management. Independent directors should meet alone in an executive session at least once a year.		Our audit committee, which is comprised solely of four independent directors, holds meetings whenever there are matters related to management directors, and such meetings are generally held once every month.

Nomination/Corporate Governance Committee
Listed companies must have a nomination/corporate governance committee composed entirely of independent directors. The committee must have a charter that addresses the purpose, responsibilities (including development of corporate governance guidelines) and annual performance evaluation of the committee.		Although we do not have a separate nomination/corporate governance committee, we maintain an independent director nomination committee composed of one non-independent director and two independent directors.

114


NYSE Corporate Governance Standards		Our Corporate Governance Practice

Compensation Committee
Listed companies must have a compensation committee composed entirely of independent directors. The committee must have a charter that addresses the purpose, responsibilities and annual performance evaluation of the committee. The charter must be made available on the company’s website. In addition, in accordance with the SEC rules adopted pursuant to Section 952 of the Dodd-Frank Act, the NYSE listing standards were amended to expand the factors relevant in determining whether a committee member has a relationship with the company.		We maintain a compensation committee comprised of one non-independent director and three independent directors.

Audit Committee
Listed companies must have an audit committee that satisfies the independence and other requirements of Rule 10A-3 under the Exchange Act. All members must be independent. The committee must have a charter addressing the committee’s purpose, an annual performance evaluation of the committee, and the duties and responsibilities of the committee. The charter must be made available on the company’s website.		We maintain an audit committee comprised solely of four independent directors.

Audit Committee Additional Requirements
Listed companies must have an audit committee that is composed of at least three directors.		Our audit committee has four independent directors.

Shareholder Approval of Equity Compensation Plan
Listed companies must allow its shareholders to exercise their voting rights with respect to any material revision to the company’s equity compensation plan.		We currently have five equity compensation plans or programs: a stock option plan for executive officers and directors, a PSU program for officers and directors, a stock appreciation rights program for officers and directors, a shareholder participation program for employees and a stock grant program for independent directors. We manage such compensation plans and programs in compliance with applicable laws, provided that, under certain circumstances, the grant of equity compensation or matters relating to the foregoing equity compensation programs are not subject to shareholders’ approval under Korean law.

Shareholder Approval of Equity Offerings
Listed companies must allow its shareholders to exercise their voting rights with respect to equity offerings that do not qualify as public offerings for cash, and offerings of equity of related parties.		Pursuant to the Korean Commercial Code and the FSCMA, our shareholders are generally entitled to preemptive rights with respect to the issuance of new shares. Exceptions include public offerings as prescribed in the FSCMA and allotments to third parties in cases necessary for the achievement of a business purpose, such as the introduction of new technology and the improvement of our financial condition.

115

Item 16J.

INSIDER

TRADING POLICIES

We have adopted insider trading policies governing the purchase, sale and other dispositions of our securities by our directors, senior management and employees. A translated excerpt of our insider trading policies, which is embedded in our organizational Disclosure Information Management Policy, is attached as an exhibit to this annual report.

Item 16K.

CYBERSECURITY

Risk Management and Strategy

We maintain a comprehensive process for assessing, identifying and managing material risks from cybersecurity threats as part of our overall risk management system and processes.

We understand the importance of preserving trust and protecting personal and other confidential information. Cybersecurity is a critical component of our overall risk management system and we have established an information security and cybersecurity framework to help safeguard the confidentiality, integrity and access of our information assets, and to ensure regulatory, contractual and operational compliance. We utilize policies, software, training programs and hardware solutions to protect and monitor our environment, including multifactor authentication, firewalls, intrusion detection and prevention systems, vulnerability and penetration testing, and identity management systems.

Our information security and cybersecurity framework and infrastructure comply with and incorporate the International Organization for Standardizations (“ISO”) standards. In February 2026, we reorganized our security governance system, which seeks to maximize execution power by combining ISO 27002 with ISO 27001.

Our Chief Information Security Officer (“CISO”), under the direct supervision of our Chief Executive Officer, oversees our approach to managing cybersecurity and digital risk and regularly engages with cross-functional teams including legal, human resources, facilities and corporate risk. We also carry insurance that provides protection against potential losses arising from cybersecurity incidents and annually review our policy and levels of coverage based on current risks.

We conduct annual information security awareness training for all directors, officers and employees and enhanced training for specialized personnel, such as personal information handlers, location information handlers and information security managers, and publish periodic cybersecurity newsletters to highlight any emerging or urgent security threats. We also conduct cyber awareness training and run tabletop exercises to simulate responses to cybersecurity incidents, and use the findings to improve our practices, procedures and technologies.

We also engage with a range of external experts, including cybersecurity assessors and consultants, to assess and report on the effectiveness of our cybersecurity and data privacy controls, and our internal incident response preparedness, as well as to help identify areas for continued focus and improvement. In addition, we engage outside legal counsel regarding cybersecurity issues such as regulatory compliance, materiality determinations, disclosure obligations and best practices for oversight, as needed. Since 2006, we have been a member of CONCERT, a Government-sponsored organization which allows members to share best practices, fight cybercrime, enhance privacy, discuss new technologies and better understand the evolving regulatory environment and advance capabilities in these areas.

Our cybersecurity risk management processes extend to the oversight and identification of threats associated with our use of third-party service providers. We review our vendors’ cybersecurity practices before we enter into business transactions with them, and we seek to contractually obligate vendors to operate their environments in accordance with strict cybersecurity standards. We also develop contingency plans for business continuity if our vendors are subject to a cyberattack that impacts our use of their systems. Furthermore, we assess the risks faced by our partners, including branch offices and stores in our extensive distribution network, at least once a

117

Table of Contents

year in order to assess risks and identify threats and vulnerabilities, and implement corrective measures. Since 2015, we have been engaging third-party assessors to conduct annual audits of our distribution network and have been conducting remote diagnoses of all personal information-processing personal computers on a weekly basis.

Our internal audit department conducts annual audits to review and evaluate the effectiveness of our internal controls relating to information security and disclosure obligations.

Upon becoming aware of such incident, we promptly deleted the malware and segregated the targeted equipment, and we have yet to find any instance of actual or attempted misuse of such information.

We also alerted the Government authorities and our customers of such attack, and promptly took further measures to mitigate the potential impact of such attack, including by engaging in a comprehensive audit of our entire network system, strengthening our monitoring efforts against USIM swap frauds and unauthorized authentication attempts, and offering free USIM protection services and free replacement of USIM cards to our subscribers to block any unauthorized misuse of their USIM information, while also cooperating with Government authorities in their investigations of this incident. From May 5, 2025 to June 23, 2025, we temporarily suspended new subscriptions of mobile phone services to alleviate the shortage of USIM card replacement inventory in accordance with administrative guidance from the MSIT. Furthermore, on July 4, 2025, in order to reaffirm our commitment and restore customer trust, we announced the “Accountability and Commitment Program” consisting of the “Customer Assurance Package,” “Information Protection Innovation Plan,” “Customer Appreciation Package” and “Subscription Cancellation Fee Waiver.” Under the Customer Assurance Package, we have been providing free subscriptions to a leading third-party mobile device security solution for all customers for one year beginning in November 2025, among other things. Under the Information Protection Innovation Plan, we announced our intent to invest approximately Won 700 billion over the course of the next five years to strengthen our cybersecurity technology, infrastructure and personnel. Under the Customer Appreciation Package, we provided a range of economic benefits to our customers totaling approximately Won 500 billion in value during the second half of 2025. Such benefits included discounts on monthly subscription fees for the month of August 2025 and free additional mobile data until the end of 2025, as well as significant membership discounts redeemable at our various partnering merchants and special benefits for returning customers, in each case subject to applicable terms and conditions. Under the Subscription Cancellation Fee Waiver, we waived the subscription cancellation fees for customers who canceled their subscriptions between April 19, 2025 (which was the date of the public announcement of the cybersecurity incident) and July 14, 2025. The number of our mobile phone subscribers decreased by approximately 0.73 million over such period. In August 2025, the Telecommunications Dispute Resolution Committee under the KMCC recommended that we waive cancellation fees through

year-end

and reduce bundled wireless and fixed-line telecommunications service cancellation fees by 50%. We declined this recommendation in September 2025.

On August 27, 2025, the PIPC imposed a fine of Won 134.8 billion and an administrative penalty of Won 9.6 million and issued a correctional order on us in connection with this incident. While we have provisionally paid the fine and the administrative penalty in full, we filed an administrative lawsuit challenging such decision in January 2026, which case is currently pending before the Seoul Administrative Court. In addition, certain of our mobile phone service subscribers have sought dispute mediation with relevant authorities to make damage claims in connection with their alleged losses relating to the incident. To date, we have declined to accept the authorities’ proposed settlements. See “Item 8.A. Consolidated Statements and Other Financial Statements — Legal Proceedings — Other Proceedings.” Certain of our mobile phone service subscribers have also filed a number of civil lawsuits seeking alleged damages in connection with this incident, all of which are currently pending before trial courts. While we are vigorously defending ourselves in each of these cases, we are unable to predict their outcomes, and no assurance can be made that additional customers will not pursue additional legal actions to seek alleged damages against us in connection with this incident.

118

Table of Contents

Other than as describe above, our business, financial condition and results of operations have not been materially affected by risks from cybersecurity threats, including as a result of previous cybersecurity incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks and any future material incidents.

Governance

Management

The cybersecurity risk management processes described above are managed by our CISO, Henry Jong-Hyeon Lee, who was newly appointed in August 2025. Our CISO has more than 12 years of experience in the area of information technology and more than 22 years of experience in the area of information protection.

In order to streamline our information protection and privacy governance regime, we operate an integrated security center led by our CISO to prevent common malicious and abusive Internet activities, such as spam, hacking of personal information, distributed

denial-of-service

attacks and dissemination of viruses, worms and other destructive or disruptive software, and to respond in real time when a situation arises. We also hold an Information Protection Committee meeting every week under the leadership of our CISO. Furthermore, key executive officers such as our Chief Operating Officer and Chief Serious-accident Prevention Officer manage company-wide information security risks under the leadership of our Chief Executive Officer.

Board of Directors

Our board of directors is committed to mitigating data privacy and cybersecurity risks and recognizes the importance of these issues as part of our risk management framework. Our board of directors maintains ultimate responsibility for the oversight of our data privacy and cybersecurity program. In addition, our board of directors receives quarterly review reports covering the status of the company’s management and protection of personal credit information from our CISO. For information security issues that have a company-wide impact, our board of directors convenes a crisis response situation room to directly engage with and advise our CISO, and the CISO reports to the board of directors the results of work performed based on such advice. Furthermore, we have established a “red team” under our CISO, which objectively assesses our security status and proposes improvement measures.

ur board of directors’ principal role is one of oversight, recognizing that management is responsible for the design, implementation and maintenance of an effective program for protecting against and mitigating data privacy and cybersecurity risks.

Members of the board of directors stay apprised of the rapidly evolving cyber threat landscape and provide guidance to management as appropriate in order to address the effectiveness of our overall data privacy and cybersecurity program.

119

INDEX TO FINANCIAL STATEMENTS


	Page

Report of Independent Registered Public Accounting Firm on the Consolidated Financial Statements (as of December 31, 2025 and for the year then ended)		F-2

Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements (as of December 31, 2024, and for each of the two years in the period then ended)		F-4

Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting		F-5

Consolidated Statements of Financial Position as of December 31, 2025 and 2024		F-7

Consolidated Statements of Income for the years ended December 31, 2025, 2024 and 2023		F-9

Consolidated Statements of Comprehensive Income for the years ended December 31, 2025, 2024 and 2023		F-10

Consolidated Statements of Changes in Equity for the years ended December 31, 2025, 2024 and 2023		F-11

Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024 and 2023		F-14

Notes to the Consolidated Financial Statements		F-16

F-1

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

SK Telecom Co., Ltd.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statement of financial position of SK Telecom Co., Ltd. and subsidiaries (the “Group”) as of December 31, 2025, the related consolidated statements of income, comprehensive income, changes in equity and cash flow for the year then ended, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as of December 31, 2025, and the results of its operation and its cash flows for the year then ended, in conformity with International Financial Reporting Standards (“IFRS”) Accounting Standards as issued by the International Accounting Standards Board.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Group’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated April 29, 2026 expressed an unqualified opinion on the effectiveness of the Group’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Group’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error of fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

F-2

Table of Contents

(i) Evaluation of goodwill impairment for the fixed-line telecommunication services cash generating unit

As discussed in Notes 3 (10) and 15 to the consolidated financial statements, the amount of goodwill that is allocated to the fixed-line telecommunication services cash generating unit (“CGU”) amounts to ₩764,082 million as of December 31, 2025. The Group performs impairment test for goodwill by comparing the recoverable amount to the carrying amount of a CGU to which goodwill is allocated.

We identified the evaluation of goodwill impairment for the fixed-line telecommunication services CGU as a critical audit matter. Estimation of certain assumptions involves a high degree of subjectivity and uncertainty and therefore, involved a high degree of subjective and complex auditor judgment. Specifically, estimates of operating revenue, perpetual growth rate and discount rate used to estimate the value in use of the fixed-line telecommunication services CGU were challenging to test.

The following are the primary procedures we performed to address this critical audit matter.

•

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Group’s goodwill impairment analysis. This included controls related to the development of operating revenue, perpetual growth rate and discount rate assumptions.

•

We performed sensitivity analysis as a risk assessment procedure

over both the discount rate and the perpetual growth rate used in the discounted cash flow forecast to assess the impact of changes in these assumptions on the Group’s determination of the value in use of the fixed-line telecommunication services CGU.

•

We evaluated estimated operating revenue by comparison with the financial budget approved by the Group. We also compared the forecasted operating revenue in prior years with the actual results to assess the Group’s ability to accurately forecast.

•

We involved our valuation professionals with specialized skills and knowledge, who assisted in (1) evaluating estimated operating revenue and perpetual growth rate by comparing them with telecommunication industry reports as well as the Group’s historical performance and (2) evaluating the discount rate by comparing it with a discount rate that was independently developed using publicly available market data for comparable entities.

/s/ KPMG Samjong Accounting Corp.

We have served as the Group’s auditor since 2024.

Seoul, the Republic of Korea

April 29, 2026

F-3

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

SK Telecom Co., Ltd.

Opinion on the Consolidated Financial

Statements

We have audited the accompanying consolidated statement of financial position of SK Telecom Co., Ltd. and subsidiaries (the “Group”) as of December 31, 2024, the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as of December 31, 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.

Basis for Opinion

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error of fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our

opinion

/s/ Ernst & Young Han Young

We have served as the Group’s auditor from 2022 to 2024.

Seoul, the Republic of Korea

April 29, 2025

F-4

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ON INTERNAL CONTROL OVER FINANCIAL REPORTING

To the Shareholders and Board of Directors of

SK Telecom Co., Ltd.:

Opinion on Internal Control Over Financial Reporting

We have audited SK Telecom Co., Ltd. and subsidiaries’ (the “Group”) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—

Integrated Framework (2013)

issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Group maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the criteria established in

Internal Control — Integrated Framework (2013)

issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statement of financial position of the Group as of December 31, 2025, the related consolidated statements of income, comprehensive income, changes in equity and cash flow for the year then ended, and the related notes (collectively referred to as the “consolidated financial statements”), and our report dated April 29, 2026 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Group’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Group’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

F-5

Table of Contents

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG Samjong Accounting Corp.

Seoul, the Republic of Korea

April 29, 2026

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2025, 2024 and 2023


(In millions of won)	Note		2025			2024			2023
Cash flows from operating activities:
Cash generated from operating activities:
Profit for the year			₩	375,084			1,387,095			1,145,937
Adjustments for income and expenses		37		4,436,619			4,313,213			4,546,338
Changes in assets and liabilities related to operating activities		37		(144,208	)		(108,813	)		(274,163	)

				4,667,495			5,591,495			5,418,112
Interest received				52,646			74,787			60,134
Dividends received				75,537			43,536			50,899
Interest paid				(371,502	)		(356,081	)		(341,488	)
Income tax paid				(500,329	)		(266,452	)		(240,452	)

Net cash provided by operating activities				3,923,847			5,087,285			4,947,205

Cash flows from investing activities:
Cash inflows from investing activities:
Decrease in short-term financial instruments, net				127,141			—			—
Collection of short-term loans				100,801			131,823			136,242
Proceeds from disposals of short-term investment securities				75,664			—			—
Proceeds from disposals of long-term investment securities				702,184			51,741			100,817
Proceeds from disposals of investments in associates and joint ventures				31,540			77,974			4,950
Proceeds from disposals of assets held for sale				25,944			13,031			1,353
Proceeds from disposals of property and equipment				240,487			47,078			12,900
Proceeds from disposals of intangible assets				10,137			32,685			4,428
Collection of long-term loans				2,915			1,680			1,547
Decrease in deposits				11,317			5,758			5,922
Proceeds from settlement of derivatives				5,047			492			1,452
Government grants received				—			—			2,967
Proceeds from disposals of subsidiaries, net of cash transferred				51,086			—			—

				1,384,263			362,262			272,578
Cash outflows for investing activities:
Increase in short-term financial instruments, net				—			(26,581	)		(51,421	)
Increase in short-term loans				(98,284	)		(110,810	)		(130,041	)
Increase in long-term loans				(13,264	)		(14,118	)		(11,602	)
Acquisitions of short-term investment securities				(110,000	)		—			—
Acquisitions of long-term investment securities				(39,538	)		(222,568	)		(324,997	)
Cash outflows from settlement of derivatives				—			(112,903	)		—
Acquisitions of investments in associates and joint ventures				(11,672	)		(8,014	)		(17,656	)
Acquisitions of property and equipment				(2,206,567	)		(2,487,360	)		(2,973,882	)
Acquisitions of intangible assets				(116,685	)		(71,856	)		(106,761	)
Increase in deposits				(18,518	)		(15,525	)		(6,848	)
Cash decrease due to changes in consolidation scope				—			(4,354	)		(2,275	)
Cash outflow from acquisitions of business				(506,844	)		—			—

				(3,121,372	)		(3,074,089	)		(3,625,483	)

Net cash used in investing activities			₩	(1,737,109	)		(2,711,827	)		(3,352,905	)

(Continued)

F-14

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity

(1)

General

SK Telecom Co., Ltd. (the “Parent Company”) was incorporated on March 29, 1984, under the laws of the Republic of Korea (“Korea”) to provide cellular telephone communication services in Korea. The head office of the Parent Company is located at 65, Eulji-ro, Jung-gu, Seoul, Korea.

The Parent Company’s common shares are listed on the Stock Market of Korea Exchange, and its depositary receipts (DRs) are listed on the New York Stock Exchange. As of December 31, 2025, the Parent Company’s total issued shares are held by the following shareholders:


	Number of shares				Percentage of total shares issued (%)
	2025		2024		2025		2024
SK Inc.		65,668,397		65,668,397		30.57		30.57
National Pension Service		14,332,207		18,878,265		6.67		8.79
Institutional investors and other shareholders		129,135,184		124,493,193		60.13		57.96
Kakao Investment Co., Ltd.		3,846,487		3,846,487		1.79		1.79
Treasury shares		1,807,778		1,903,711		0.84		0.89

		214,790,053		214,790,053		100.00		100.00

These consolidated financial statements comprise the Parent Company and its subsidiaries (collectively referred to as the “Group”). SK Inc. is the ultimate controlling entity of the Parent Company.

(2)

List of consolidated subsidiaries

The list of consolidated subsidiaries as of December 31, 2025 and 2024 is as follows:

Ownership (%)(*1)

Subsidiary

Location

Primary business

Dec. 31,
2025

Dec. 31,
2024

Subsidiaries owned by the Parent Company

SK Telink Co., Ltd.

Korea

International telecommunication and Mobile Virtual Network Operator service

100.0

NATE Communications Corporation (Formerly, SK Communications Co., Ltd.)(*2)

Korea

Internet website services

—

100.0

SK Broadband Co., Ltd.(*3)

Korea

Fixed-line telecommunication services

99.1

PS&Marketing Corporation

Korea

Communications device retail business

100.0

SERVICE ACE Co., Ltd.

Korea

Call center management service

100.0

SERVICE TOP Co., Ltd.

Korea

Call center management service

100.0

SK O&S Co., Ltd.

Korea

Base station maintenance service

100.0

SK Telecom China Holdings Co., Ltd.

China

Investment (Holdings company)

100.0

YTK Investment Ltd.(*2)

Cayman Islands

Investment

—

100.0

Atlas Investment

Cayman Islands

Investment

100.0

SK Telecom Americas, Inc.

USA

Information gathering and consulting

100.0

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity, Continued

(2)

List of consolidated subsidiaries, Continued

The list of consolidated subsidiaries as of December 31, 2025 and 2024 is as follows, Continued:

Ownership (%)(*1)

Subsidiary

Location

Primary business

Dec. 31,
2025

Dec. 31,
2024

Happy Hanool Co., Ltd.

Korea

Service

100.0

SK stoa Co., Ltd.

Korea

Other telecommunication retail business

100.0

SAPEON Inc.

USA

Investment (Holdings company)

62.5

Astra AI Infra LLC

USA

Investment

100.0

Subsidiaries owned by SK Broadband Co., Ltd.

Home & Service Co., Ltd.

Korea

Operation of information and

communication facility

100.0

Media S Co., Ltd.

Korea

Production and supply services of

broadcasting programs

100.0

Subsidiary owned by PS&Marketing Corporation

SK m&service Co., Ltd.(*2)

Korea

Database and Internet website service

—

100.0

Subsidiary owned by SK Telecom Americas, Inc.

Global AI Platform Corporation

USA

Software development and supply business

100.0

Subsidiary owned by Global AI Platform Corporation

Global AI Platform Corporation Korea

Korea

Software development and supply business

100.0

Subsidiary owned by Atlas Investment

Forest AI Investment(*2)

Cayman Islands

Investment

100.0

—

Others(*4)

SK Telecom Innovation Fund, L.P.

USA

Investment

100.0

(*1)

The ownership interest represents direct ownership interest in subsidiaries either by the Parent Company or subsidiaries of the Parent Company.

(*2)

Details of changes in the consolidation scope for the year ended December 31, 2025 are presented in note 1-(4).

(*3)

In connection with the merger involving SK Broadband Co., Ltd that occurred prior to the periods presented herein, the Parent Company entered into a shareholders’ agreement with the existing shareholders of the merged entities. Pursuant to the shareholders’ agreement, the Parent Company entered into a share purchase agreement to acquire an additional 24.76% of the shares of SK Broadband Co., Ltd. for ₩1,145,870 million

on November 13, 2024. Based on the terms and conditions of the agreement, the Parent Company concluded that it obtained

the 24.76% ownership interest in SK Broadband Co., Ltd as of the agreement date, and has accounted for the shares as an ownership interest in a subsidiary accordingly.

(*4)

Other is owned by Atlas Investment and another subsidiary of the Parent Company.

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity, Continued

(3)

Condensed financial information of subsidiaries

Condensed financial information of significant consolidated subsidiaries as of and for the year ended December 31, 2025 is as follows:


(In millions of won)
	As of December 31, 2025						2025
Subsidiary	Total assets		Total liabilities		Total equity		Revenue		Profit (loss)
SK Telink Co., Ltd.	₩	205,972		62,038		143,934		345,910		8,946
SK Broadband Co., Ltd.		6,824,041		4,011,668		2,812,373		4,540,603		141,489
PS&Marketing Corporation		454,512		210,013		244,499		1,383,335		13,748
SERVICE ACE Co., Ltd.		97,050		68,222		28,828		184,525		2,356
SERVICE TOP Co., Ltd.		69,385		46,453		22,932		154,764		1,103
SK O&S Co., Ltd.		124,327		87,023		37,304		381,574		630
Home & Service Co., Ltd.		148,382		110,021		38,361		516,346		1,557
SK stoa Co., Ltd.		134,596		67,405		67,191		313,050		6,518
SK m&service Co., Ltd.(*)		—		—		—		46,240		(4,407	)

(*)

The condensed financial information of SK m&service Co., Ltd. represents the financial information up to the date of disposal.

Condensed financial information of significant consolidated subsidiaries as of and for the year ended December 31, 2024 is as follows:


(In millions of won)
	As of December 31, 2024						2024
Subsidiary	Total assets		Total liabilities		Total equity		Revenue		Profit
SK Telink Co., Ltd.	₩	210,962		63,558		147,404		341,838		14,323
SK Broadband Co., Ltd.		6,806,280		3,760,426		3,045,854		4,415,270		263,967
PS&Marketing Corporation		448,887		218,885		230,002		1,382,361		63
SERVICE ACE Co., Ltd.		74,676		49,818		24,858		191,376		2,585
SERVICE TOP Co., Ltd.		60,073		42,479		17,594		166,699		969
SK O&S Co., Ltd.		130,618		94,807		35,811		351,721		689
Home & Service Co., Ltd.		139,664		107,379		32,285		495,546		3,947
SK stoa Co., Ltd.		116,785		56,192		60,593		302,332		4,354
SK m&service Co., Ltd.		164,772		100,230		64,542		246,999		220

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity, Continued

(3)

Condensed financial information of subsidiaries, Continued

Condensed financial information of the significant consolidated subsidiaries as of and for the year ended December 31, 2023 is as follows:


(In millions of won)
	As of December 31, 2023						2023
Subsidiary	Total assets		Total liabilities		Total equity		Revenue		Profit (loss)
SK Telink Co., Ltd.	₩	213,920		65,049		148,871		309,091		17,761
SK Broadband Co., Ltd.		6,442,611		3,323,156		3,119,455		4,281,932		213,905
PS&Marketing Corporation		451,549		224,042		227,507		1,353,321		4,681
SERVICE ACE Co., Ltd.		83,395		54,888		28,507		197,598		2,822
SERVICE TOP Co., Ltd.		71,196		47,641		23,555		178,423		1,738
SK O&S Co., Ltd.		140,942		98,346		42,596		345,617		2,614
Home & Service Co., Ltd.		165,667		112,025		53,642		490,094		1,297
SK stoa Co., Ltd.		94,041		37,253		56,788		301,496		(1,427	)
SK m&service Co., Ltd.		153,660		88,195		65,465		247,479		1,253

(4)

Changes in subsidiaries

Details of subsidiary that was newly included in consolidation scope for the year ended December 31, 2025 is as follows:


Subsidiary		Reason
Forest AI Investment		Established by Atlas Investment

Details of subsidiaries that were excluded from consolidation scope for the year ended December 31, 2025 are as follows:


Subsidiary		Reason
NATE Communications Corporation (Formerly, SK Communications Co., Ltd.)		Loss of control
SK m&service Co., Ltd.		Loss of control
YTK Investment Ltd.		Liquidation

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity, Continued

(5)

The financial information of material non-controlling interests of the Group as of and for the years ended December 31, 2025, 2024 and 2023 are as follows:

2025


(In millions of won)
	SAPEON Inc.
Ownership of non-controlling interests (%)		37.5

	As of December 31, 2025
Current assets	₩	10,393
Non-current assets		187,491
Current liabilities		(16,454	)
Non-current liabilities		—
Net assets		181,430
Carrying amount of non-controlling interests		68,133

	2025
Revenue	₩	—
Profit for the year		(91,558	)
Total comprehensive income		(98,732	)
Profit attributable to non-controlling interests		(34,384	)

Net cash used in operating activities	₩	(4,082	)
Net cash provided by investing activities		9,738
Net cash used in financing activities		(25,310	)
Effects of exchange rate changes on cash and cash equivalents		(890	)
Net decrease in cash and cash equivalents		(20,544	)

Dividends paid to non-controlling interests for the year ended December 31, 2025	₩	—

2024

As of December 31, 2023 the material non-controlling interest of the Group was attributed to SK Broadband Co., Ltd. The non-controlling interest of SK Broadband Co., Ltd. decreased during the year ended December 31, 2024, therefore, there are no material non-controlling interests of the Group as of December 31, 2024.

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

1.	Reporting Entity, Continued

(5)

The financial information of material non-controlling interests of the Group as of and for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:

2023


(In millions of won)
	SK Broadband Co., Ltd.(*)
Ownership of non-controlling interests (%)		25.4

	As of December 31, 2023
Current assets	₩	1,388,965
Non-current assets		5,214,315
Current liabilities		(1,388,317	)
Non-current liabilities		(1,988,989	)
Net assets		3,225,974
Carrying amount of non-controlling interests		819,592

	2023
Revenue	₩	4,274,747
Profit for the year		202,890
Total comprehensive income		183,499
Profit attributable to non-controlling interests		51,448

Net cash provided by operating activities	₩	1,110,847
Net cash used in investing activities		(1,064,434	)
Net cash used in financing activities		(60,254	)
Effects of exchange rate changes on cash and cash equivalents		9
Net decrease in cash and cash equivalents		(13,832	)

Dividends paid to non-controlling interests for the year ended December 31, 2023	₩	50,557

(*)

The above condensed financial information is the consolidated financial information of the subsidiary and reflects fair value adjustments as a result of the business combination.

2.	Basis of Preparation

(1)

Statement of compliance

These consolidated financial statements were prepared in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board (“IASB”).

The consolidated financial statements were authorized for issuance by the Board of Directors on February 5, 2026 for statutory shareholders’ approval purpose, and re-authorized for issue by management in connection with the filing with the U.S. Securities Exchange Commission on April 29, 2026.

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

2.	Basis of Preparation, Continued

(2)

Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis, except for the following material items in the consolidated statement of financial position:

•

derivative financial instruments measured at fair value;

•

financial instruments measured at fair value through profit or loss (“FVTPL”);

•

financial instruments measured at fair value through other comprehensive income (“FVOCI”);

•

liabilities measured at fair value for cash-settled share-based payment arrangement; and

•

liabilities (assets) for defined benefit plans recognized at the total present value of defined benefit obligations less the fair value of plan assets.

(3)

Functional and presentation currency

Financial statements of Group entities within the Group are prepared in functional currency of each group entity, which is the currency of the primary economic environment in which each entity operates. Consolidated financial statements of the Group are presented in Korean won, which is the Parent Company’s functional and presentation currency.

(4)

Use of estimates and judgments

The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period prospectively.

Critical judgments

Information about critical judgments in applying accounting policies that have the most significant effects on the amounts recognized in the consolidated financial statements is included in notes for the following areas: consolidation (whether the Group has de facto control over an investee), and determination of stand-alone selling prices.

Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are included in the following notes: loss allowance (notes 6 and 34), estimated useful lives of costs to obtain a contract (notes 8), property and equipment and intangible assets (notes 3 (7), (8), 12 and 16), impairment of non-financial assets including goodwill and other non-financial assets (notes 3 (10) and 15), recognition of provision (notes 3 (15) and 19), measurement of defined benefit liabilities (assets) (notes 3 (14) and 20), transaction of derivative instruments (notes 3 (6) and 21) and recognition of deferred tax assets (liabilities) (notes 3 (23) and 30).

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

2.	Basis of Preparation, Continued

(4)

Use of estimates and judgments, Continued

Fair value measurement

The Group’s accounting policies and disclosures require the measurement of fair values, for both a number of financial and non-financial assets and liabilities. The Group has an established policies and processes with respect to the measurement of fair values including Level 3 fair values, and the measurement of fair values is reviewed and is directly reported to the finance executives.

The Group regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then the Group assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of IFRS, including the level in the fair value hierarchy in which such valuations should be classified.

When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

•

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

•

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

•

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The Group recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Information about assumptions used for fair value measurements are included in note 21 and note 34.

3.	Material Accounting Policies

The material accounting policies applied by the Group in the preparation of its consolidated financial statements in accordance with IFRS are included below. Except for certain standards and amendments which are effective for annual periods beginning on or after January 1, 2025, the material accounting policies have been consistently applied by the Group for all periods presented. The Group has not early adopted any standards, interpretations or amendments that have been issued but are not yet effective.

The new and amended standards and interpretations that are effective for annual periods beginning on or after January 1, 2025 are as follows. These amended standards had no material impact on the Group’s consolidated financial statements.

•

Lack of Exchangeability (Amendments to IAS 21

The Effect of Changes in Foreign Exchange Rates

and IFRS 1

First-time Adoption of International Financial Reporting Standards

)

•

Disclosure of differences in estimation techniques (Amendments to IFRS 17

Insurance Contracts

)

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(1)

Operating segments

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. The Group’s operating segments have been determined to be each business unit, for which the Group generates separately identifiable financial information that is regularly reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance. The Group has three reportable segments as described in note 4. Segment results that are reported to the chief operating decision maker include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

(2)

Basis of consolidation

(a)

Business combination

A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control.

In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs.

The Group has an option to apply a ‘concentration test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The optional concentration test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.

Consideration transferred is generally measured at fair value, identical to the measurement of identifiable net assets acquired at fair value. The difference between the acquired company’s fair value and the consideration transferred is accounted for goodwill. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognized in profit or loss immediately. Acquisition-related costs are expensed in the periods in which the costs are incurred and the services are received, except if related to the costs to issue debt or equity securities recognized based on IAS 32 and IFRS 9.

Consideration transferred does not include the amount settled in relation to the pre-existing relationship. Such amounts are generally recognized through profit or loss.

Contingent consideration is measured at fair value at the acquisition date. Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. If contingent consideration is not classified as equity, the Group subsequently recognizes changes in fair value of contingent consideration through profit or loss.

(b)

Non-controlling interests

Non-controlling interests are measured at their proportionate share of the acquiree’s identifiable net assets at the date of acquisition.

Changes in a Controlling Company’s ownership interest in a subsidiary that do not result in the Controlling Company losing control of the subsidiary are accounted for as equity transactions.

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(2)

Basis of consolidation, Continued

(c)

Subsidiaries

Subsidiaries are entities controlled by the Group. The Group controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Consolidation of an investee begins from the date the Group obtains control of the investee and cease when the Group loses control of the investee.

(d)

Loss of control

If the Group loses control of a subsidiary, the Group derecognizes the assets and liabilities of the former subsidiary from the consolidated statement of financial position and recognizes gain or loss associated with the loss of control attributable to the former controlling interest. Any investment retained in the former subsidiary is recognized at its fair value when control is lost.

(e)

Interest in investees accounted for using the equity method

Interest in investees accounted for using the equity method composed of interest in associates and joint ventures.

An associate is an entity in which the Group has significant influence, but not control, over the entity’s financial and operating policies. A joint venture is a joint arrangement whereby the Group that has joint control of the arrangement has rights to the net assets of the arrangement.

The investment in an associate and a joint venture is initially recognized at cost including transaction costs and subsequently accounted for using the equity method. The carrying amount of the investment is adjusted to reflect the Group’s share of the investee’s profit or loss and other comprehensive income arising after the date of acquisition. Distributions received from the investee are deducted from the carrying amount of the investment.

However, when significant influence exists but there is no substantive access to the returns associated with ownership interests in an associate or joint venture, the related financial instruments are accounted for in accordance with IFRS 9,

Financial Instruments

(f)

Intra-group transactions

Intra-group balances and transactions, and any unrealized income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. The Group’s share of unrealized gain incurred from transactions with investees accounted for using the equity method are eliminated and unrealized loss are eliminated using the same basis if there are no evidence of asset impairments.

(g)

Business combinations under common control

SK Inc. is the ultimate controlling entity of the Group. The assets and liabilities acquired under business combination under common control are recognized at the carrying amounts in the ultimate controlling shareholder’s consolidated financial statements. The difference between consideration and carrying amount of net assets acquired is added to or subtracted from capital surplus and others.

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(3)

Cash and cash equivalents

Cash and cash equivalents comprise cash balances, call deposits and investment securities with maturities of three months or less from the acquisition date that are easily convertible to cash and subject to an insignificant risk of changes in their fair value.

(4)

Inventories

Handsets are measured at acquisition cost using the specific identification method, after deducting purchase discounts, rebates and other similar items. Other inventories are measured using the weighted average method. Also, during the reporting period, a perpetual inventory system is used to track inventory quantities, which is adjusted based on the physical inventory counts performed at the period end. When the net realizable value of inventories is less than cost, the carrying amount is reduced to the net realizable value, and any difference is charged to current period as operating expenses.

(5)

Non-derivative financial assets

(a)

Recognition and initial measurement

Accounts receivable – trade and debt investments issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the instrument.

A financial asset (unless an accounts receivable – trade without a significant financing component) or financial liability is initially measured at fair value. For an item not at FVTPL, transaction costs that are directly attributable to its acquisition or issue added to or deducted from fair value. An accounts receivable – trade without a significant financing component is initially measured at the transaction price.

(b)

Classification and subsequent measurement

On initial recognition, a financial asset is classified as measured at:

•

FVTPL

•

FVOCI – equity investment

•

FVOCI – debt investment

•

Financial assets at amortized cost

A financial asset is classified based on the business model in which a financial asset is managed and its contractual cash flow characteristics.

Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(5)

Non-derivative financial assets, Continued

(b)

Classification and subsequent measurement, Continued

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

•

it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

•

its contractual terms give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding on specified dates.

A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL:

•

it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

•

its contractual terms give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding on specified dates.

On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the investment’s fair value in other comprehensive income (“OCI”). This election is made on an investment-by-investment basis.

All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

F-2

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(5)

Non-derivative financial assets, Continued

(b)

Classification and subsequent measurement, Continued

The following accounting policies are applied to the subsequent measurement of financial assets.


Financial assets at FVTPL		These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

Financial assets at amortized cost		These assets are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

Debt investments at FVOCI		These assets are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit or loss.

Equity investments at FVOCI		These assets are subsequently measured at fair value. Dividends are recognized as income in profit or loss unless the dividend clearly represents a recovery of the cost of the investment. Other net gains and losses are recognized in OCI and are never reclassified to profit or loss.

(c)

Impairment

The Group estimates the expected credit losses (“ECL”) for the debt instruments measured at amortized cost and FVOCI based on the Group’s historical experience and informed credit assessment that includes forward-looking information. The impairment approach is decided based on the assessment of whether the credit risk of a financial asset has increased significantly since initial recognition. However, the Group applies a practical expedient and recognizes impairment losses equal to lifetime ECLs for accounts receivable – trade and lease receivables from the initial recognition.

ECL is a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e., the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive).

At each reporting date, the Group assesses whether financial assets measured at amortized cost and debt investments at FVOCI are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

F-28

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(5)

Non-derivative financial assets, Continued

(c)

Impairment, Continued

Loss allowance on financial assets measured at amortized cost is deducted from the carrying amount of the respective assets, while loss allowance on debt instruments at FVOCI is recognized in OCI, instead of reducing the carrying amount of the transferred assets.

(d)

Derecognition

Financial assets

The Group derecognizes a financial asset when:

•

the contractual rights to the cash flows from the financial asset expire; or

•

it transfers the rights to receive the contractual cash flows in a transaction in which either: substantially all of the risks and rewards of ownership of the financial asset are transferred; or

•

the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Group enters into transactions whereby it transfers assets recognized in its consolidated statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized.

Interest rate benchmark reform

When the basis for determining the contractual cash flows of a financial asset or financial liability measured at amortized cost changed as a result of interest rate benchmark reform, the Group updated the effective interest rate of the financial asset or financial liability to reflect the change that is required by the reform. A change in the basis for determining the contractual cash flows is required by interest rate benchmark reform if the following conditions are met:

•

the change is necessary as a direct consequence of the reform; and

•

the new basis for determining the contractual cash flows is economically equivalent to the previous basis – i.e., the basis immediately before the change.

When changes were made to a financial asset or financial liability in addition to changes to the basis for determining the contractual cash flows required by interest rate benchmark reform, the Group first updated the effective rate of the financial asset or financial liability to reflect the change that is required by interest rate benchmark reform. After that, the Group applied the policies on accounting for modifications to the additional changes.

(e)

Offsetting

Financial assets and financial liabilities are offset, and the net amount is presented in the statement of financial position when the Group currently has a legally enforceable right to offset the recognized amounts and intends either to settle on a net basis or to settle the liability and realize the asset simultaneously.

F-29

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(5)

Non-derivative financial assets, Continued

(e)

Offsetting, Continued

A financial asset and a financial liability are offset only when the right to set off the amount is not contingent on future event and legally enforceable even on the event of default, insolvency or bankruptcy.

(6)

Derivative financial instruments, including hedge accounting

Derivatives are initially recognized at fair value. Subsequent to initial recognition, derivatives are measured at fair value at the end of each reporting period, and changes therein are accounted for as described below.

(a)

Hedge accounting

The Group holds forward exchange contracts, interest rate swaps, currency swaps and other derivative contracts to manage interest rate risk and foreign exchange risk. The Group designates derivatives as hedging instruments to hedge the variability in cash flow associated with highly probable forecasted transactions or firm commitments (a cash flow hedge).

On initial designation of the hedge, the Group formally documents the relationship between the hedging instrument(s) and hedged item(s), including the risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship.

Hedges directly affected by interest rate benchmark reform

When uncertainty arises about the interest rate benchmark designated as a hedged risk and the timing or the amount of the interest rate benchmark-based cash flows of the hedged item or of the hedging instrument as a result of IBOR reform, for the purpose of evaluating whether there is an economic relationship between the hedged items and the hedging instruments, the Group assumes that the interest rate benchmark on which the hedged items and the hedging instruments are based is not altered as a result of interest rate benchmark reform.

For a cash flow hedge of a forecast transaction, the Group assumes that the benchmark interest rate will not be altered as a result of interest rate benchmark reform for the purpose of assessing whether the forecast transaction is highly probable and determining whether a previously designated forecast transaction in a discontinued cash flow hedge is still expected to occur.

The Group will cease applying the specific policy for assessing the economic relationship between the hedged item and the hedging instrument.

•

to a hedged item or hedging instrument when the uncertainty arising from interest rate benchmark reform is no longer present with respect to the timing and the amount of the interest rate benchmark-based cash flows of the respective item or instrument; or

•

when the hedging relationship is discontinued.

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(6)

Derivative financial instruments, including hedge accounting, Continued

(a)

Hedge accounting, Continued

When the basis for determining the contractual cash flows of the hedged item or hedging instrument changes as a result of IBOR reform and therefore there is no longer uncertainty arising about the cash flows of the hedged item or the hedging instrument, the Group amends the hedge documentation of that hedging relationship to reflect the change(s) required by IBOR reform.

The Group amends the formal hedge documentation by the end of the reporting period during which a change required by IBOR reform is made to the hedged risk, hedged item or hedging instrument. These amendments in the formal hedge documentation do not constitute the discontinuation of the hedging relationship or the designation of a new hedging relationship.

If changes are made in addition to those changes required by interest rate benchmark reform to the financial asset or financial liability designated in a hedging relationship or to the designation of the hedging relationship, the Group determines whether those additional changes result in the discontinuation of hedging accounting. If the additional changes do not result in the discontinuation of hedging accounting, the Group amend the formal designation of the hedging relationship.

When the interest rate benchmark on which the hedged future cash flows had been based is changed as required by IBOR reform, for the purpose of determining whether the hedged future cash flows are expected to occur, the Group deems that the hedging reserve recognized in OCI for that hedging relationship is based on the alternative benchmark rate on which the hedged future cash flows will be based.

Cash flow hedge

When a derivative is designated to hedge the variability in cash flows attributable to a particular risk associated with a recognized asset or liability or a highly probable forecasted transaction that could affect profit or loss, the effective portion of changes in the fair value of the derivative is recognized in other comprehensive income, net of tax, and presented in the hedging reserve in equity. Any ineffective portion of changes in the fair value of the derivative is recognized immediately in profit or loss. If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated, exercised, or the designation is revoked, then hedge accounting is discontinued prospectively. The cumulative gain or loss on the hedging instrument that has been recognized in other comprehensive income is reclassified to profit or loss in the periods during which the forecasted transaction occurs. If the forecasted transaction is no longer expected to occur, then the balance in other comprehensive income is recognized immediately in profit or loss.

(b)

Other derivative financial instruments

Other derivative financial instrument not designated as a hedging instrument are measured at fair value, and the changes in fair value of the derivative financial instrument is recognized immediately in profit or loss.

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(7)

Property and equipment

Property and equipment are initially measured at cost. The cost of property and equipment includes expenditures arising directly from the construction or acquisition of the asset, any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Property and equipment, subsequently, are carried at cost less accumulated depreciation and accumulated impairment losses.

Subsequent costs are recognized in the carrying amount of property and equipment at cost or, if appropriate, as a separate item if it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be reliably measured. The carrying amount of the replaced part is derecognized. The costs of the day-to-day servicing are recognized in profit or loss as incurred.

Property and equipment, except for land, are depreciated on a straight-line basis over estimated useful lives that appropriately reflect the pattern in which the asset’s future economic benefits are expected to be consumed. A component that is significant compared to the total cost of property and equipment is depreciated over its separate useful life.

Gains and losses on disposal of an item of property and equipment are determined by comparing the proceeds from disposal with the carrying amount of property and equipment and are recognized as other operating income or expense.

The estimated useful lives of the Group’s property and equipment are as follows:


		Useful lives (years)
Buildings and structures		15 ~ 40
Machinery		3 ~ 15, 30
Other property and equipment		3 ~ 10
Right-of-use assets		1 ~ 50

The Group reviews estimated residual values, expected useful lives, and depreciation methods annually at the end of each reporting date and adjusts, if appropriate. The change is accounted for as a change in an accounting estimate.

(8)

Intangible assets

Intangible assets are measured initially at cost and, subsequently, are carried at cost less accumulated amortization and accumulated impairment losses.

Intangible assets, except for goodwill, are amortized on a straight-line basis over the estimated useful lives of intangible assets from the date that they are available for use. The residual value of intangible assets is zero. However, club memberships and brand are expected to be available for use as there are no foreseeable limits to the periods. These intangible assets are determined as having indefinite useful lives and, therefore, not amortized.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(8)

Intangible assets, Continued

The estimated useful lives of the Group’s intangible assets are as follows:


		Useful lives (years)
Frequency usage rights		5 ~ 10
Land usage rights		5
Industrial rights		5, 10
Development costs		5
Facility usage rights		10, 20
Customer relations		3 ~ 15
Other		3 ~ 20

Amortization periods and the amortization methods for intangible assets with finite useful lives are reviewed at the end of each reporting period. The useful lives of intangible assets that are not being amortized are reviewed at the end of each reporting period to determine whether events and circumstances continue to support indefinite useful life assessments for those assets. Changes, if appropriate, are accounted for as changes in accounting estimates.

Expenditures on research activities are recognized in profit or loss as incurred. Development expenditures are capitalized only if development costs can be reliably measured, the product or process is technically and commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources to complete development and to use or sell the asset. Other development expenditures are recognized in profit or loss as incurred.

Subsequent expenditures are capitalized only when they increase the future economic benefits embodied in the specific asset to which it relates. All other expenditures, including expenditures on internally generated goodwill and brands, are recognized in profit or loss as incurred.

(9)

Investment properties

Investment properties are properties held to earn rent income and/or for capital appreciation. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are reported at cost less accumulated depreciation and accumulated impairment losses.

Subsequent expenditures are recognized in carrying amount of an asset or as a separate asset if it is probable that future economic benefits associated with the assets will flow into the Group and the cost of an asset can be measured reliably. The carrying amount of those parts that are replaced is derecognized. The costs associated with routine maintenance and repairs are recognized in profit or loss as incurred.

Investment property, except for land, is depreciated on a straight-line basis over estimated useful lives of 30 ~ 40 years. In addition, right-of-use asset classified as investment property is depreciated using the straight-line basis from the commencement date to the end of the lease term.

The depreciation method, estimated useful lives and residual values are reviewed at the end of each reporting date and adjusted, if appropriate. The change is accounted for as a change in an accounting estimate.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(10)

Impairment of non-financial assets

The carrying amounts of the Group’s non-financial assets other than contract assets recognized for revenue arising from contracts with a customer, assets recognized for the costs to obtain or fulfill a contract with a customer, employee benefits, inventories, deferred tax assets, and non-current assets held for sale are reviewed at the end of the reporting period to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill and intangible assets that have indefinite useful lives or that are not yet available for use, irrespective of whether there is any indication of impairment, are tested for impairment annually by comparing their recoverable amounts to their carrying amounts.

The Group estimates the recoverable amount of an individual asset, and if it is impossible to measure the individual recoverable amount of an asset, the Group estimates the recoverable amount of cash-generating unit (“CGU”). A CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is determined by estimating the future cash flows expected to be generated by the asset or CGU and discounting those cash flows using an appropriate discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU, to the extent those risks have not been incorporated into the cash flow estimates.

An impairment loss is recognized in profit or loss to the extent the carrying amount of the asset exceeds its recoverable amount.

Goodwill acquired in a business combination is allocated to each CGU that is expected to benefit from the synergy arising from the business acquired. Any impairment identified at the CGU level will first reduce the carrying amount of goodwill and then be used to reduce the carrying amount of the other assets in the CGU on a pro rata basis. Except for impairment losses recognized on goodwill, which are never reversed, the Group assesses at each reporting date whether there is any indication that a previously recognized impairment loss may no longer exist or may have decreased. A reversal of an impairment loss is recognized only when there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, had no impairment loss been recognized.

(11)

Leases

A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

(a)

The Group as a lessee

At commencement or on modification of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component on the basis of its relative stand-alone prices. However, the Group has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(11)

Leases, Continued

(a)

The Group as a lessee, Continued

The Group recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line basis from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.

The Group determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.

Lease payments included in the measurement of the lease liability comprise the following:

•

fixed payments, including in-substance fixed payments;

•

variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

•

amounts expected to be payable under a residual value guarantee; and

•

the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Group is reasonably certain not to terminate early.

The lease liability is measured at amortized cost using the effective interest method. The Group remeasures the lease liability when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee, if the Group changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in-substance fixed lease payment.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(11)

Leases, Continued

(a)

The Group as a lessee, Continued

The Group presents right-of-use assets that do not meet the definition of investment property in ‘property and equipment’ in the statement of financial position.

The Group has elected not to recognize right-of-use assets and lease liabilities for leases of low-value assets and short-term leases. The Group recognizes the lease payments on short-term leases and leases of low value assets as an expense on a straight-line basis over the lease term.

(b)

Group as a lessor

At inception or on modification of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices.

When the Group acts as a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease.

To classify each lease, the Group makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the Group considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Group is an intermediate lessor, is accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which the Group applies the exemption described above, then it classifies the sub-lease as an operating lease.

If an arrangement contains lease and non-lease components, then the Group applies IFRS 15 to allocate the consideration in the contract.

The Group applies derecognition and impairment requirements in IFRS 9 to the net investment in the lease. The Group further regularly reviews estimated unguaranteed residual values used in calculating the gross investment in the lease.

The Group recognizes lease payments received under operating leases as income on a straight-line basis over the lease term as part of ‘other revenue’.

(12)

Assets held for sale

Non-current assets, or disposal groups comprising assets and liabilities, that are expected to be recovered primarily through sales rather than through continuing use, are classified as held for sale. In order to be classified as held for sale, the assets (or disposal groups) must be available for immediate sale in their present condition and their sale must be highly probable. The assets or disposal groups that are classified as assets held for sale are measured at the lower of their carrying amounts and fair value less cost to sell. The Group recognizes an impairment loss for any initial or subsequent write-down of assets (or disposal groups) to fair value less costs to sell and a gain for any subsequent increase in fair value less costs to sell up to the cumulative impairment loss previously recognized.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(12)

Assets held for sale, Continued

An asset that is classified as held for sale or part of a disposal group classified as held for sale is not depreciated (or amortized).

(13)

Non-derivative financial liabilities

The Group classifies non-derivative financial liabilities into financial liabilities at fair value through profit or loss or other financial liabilities in accordance with the substance of the contractual arrangement. The Group recognizes financial liabilities in the consolidated statement of financial position when the Group becomes a party to the contractual provisions of the financial liabilities.

(a)

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading or designated as such upon initial recognition.

Financial liabilities designated at fair value through profit or loss are measured at fair value subsequent to initial recognition. The amount of change in fair value of financial liability that is attributable to changes in the credit risk of that liability shall be presented in other comprehensive income, and the remaining amount of change in the fair value of the liability shall be presented in profit or loss. Upon initial recognition, transaction costs that are directly attributable to the issue of the financial liability are recognized in profit or loss as incurred.

(b)

Other financial liabilities

Non-derivative financial liabilities other than financial liabilities at fair value through profit or loss are classified as other financial liabilities. At the date of initial recognition, other financial liabilities are measured at fair value minus transaction costs that are directly attributable to the issue of the financial liabilities. Subsequent to initial recognition, other financial liabilities are measured at amortized cost and the interest expenses are recognized using the effective interest method.

(c)

Derecognition of financial liability

The Group extinguishes a financial liability only when the contractual obligation is fulfilled, canceled or expires. The Group recognizes new financial liabilities at fair value based on new contracts and eliminates existing liabilities when the contractual terms of the financial liabilities change and the cash flows change substantially.

When a financial liability is derecognized, the difference between the carrying amount and the consideration paid (including any transferred non-cash assets or liabilities assumed) is recognized in profit or loss.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(14)

Employee benefits

(a)

Short-term employee benefits

Short-term employee benefits are employee benefits that are due to be settled within 12 months after the end of the period in which the employees render related services. When an employee has rendered a service to the Group during an accounting period, the Group recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service.

(b)

Other long-term employee benefits

Other long-term employee benefits include employee benefits that are settled beyond 12 months after the end of the period in which the employees render related services. The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value. Remeasurements are recognized in profit or loss in the period in which they arise.

(c)

Retirement benefits: defined contribution plans

When an employee has rendered a service to the Group during a period, the contribution payable to a defined contribution plan in exchange for that service is recognized through profit or loss except when the contribution is included in the cost of an asset. The Group recognizes the contribution payable as a liability (accrued expense), after deducting any contribution already paid. If the contribution already paid exceeds the contribution due for service before the end of the reporting period, the Group recognizes that excess as an asset (prepaid expense) to the extent that the prepayment will lead to a reduction in future payments or a cash refund.

(d)

Retirement benefits: defined benefit plans

At the end of reporting period, defined benefit liabilities (assets) relating to defined benefit plans are recognized at present value of defined benefit obligations net of fair value of plan assets.

The calculation is performed annually by an independent actuary using the projected unit credit method. When the fair value of plan assets exceeds the present value of the defined benefit obligation, the Group recognizes an asset, to the extent of the present value of any economic benefits available in the form of refunds from the plan or reduction in the future contributions to the plan.

Remeasurements of the net defined benefit liability (asset), which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income. The Group determines net interests on net defined benefit liability (asset) by multiplying discount rate determined at the beginning of the annual reporting period and considers changes in net defined benefit liability (asset) from contributions and benefit payments. Net interest costs and other costs relating to the defined benefit plan are recognized through profit or loss.

When the plan amendment or curtailment occurs, gains or losses on amendment or curtailment in benefits for the past service provided are recognized through profit or loss. The Group recognizes a gain or loss on a settlement when the settlement of defined benefit plan occurs.

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(15)

Provisions

Provisions are recognized when the Group has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The risks and uncertainties that inevitably surround many events and circumstances are taken into account in reaching the best estimate of a provision. If the effect of the time value of money is material, provisions are determined at the present value of the expected future cash flows.

If some or all of the expenditures required to settle a provision are expected to be reimbursed by another party, the reimbursement is recognized when, and only when, it is virtually certain that reimbursement will be received if the entity settles the obligation. The reimbursement is treated as a separate asset.

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimates. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision is reversed.

A provision is used only for expenditures for which the provision was originally recognized.

(16)

Emissions Rights

The Group accounts for greenhouse gases emission right and the relevant liability as below pursuant to the Act on Allocation and Trading of Greenhouse Gas Emission in Korea.

(a)

Greenhouse Gases Emission Right

Greenhouse Gases Emission Right consists of emission allowances, which are allocated from the government free of charge or purchased from the market. The cost includes any directly attributable costs incurred during the normal course of business.

The Group derecognizes an emission right asset when the emission allowance is unusable, disposed or submitted to government in which the future economic benefits are no longer expected to be probable.

(b)

Emissions liability

Emission liability is a present obligation of submitting emission rights to the government with regard to emission of greenhouse gas. The emission liability is measured based on the expected quantity of emission for the performing period in excess of emission allowance in possession and the unit price for such emission rights in the market at the end of the reporting period. The emissions liabilities are derecognized when they are surrendered to the government.

(17)

Transactions in foreign currencies

(a)

Foreign currency transactions

Transactions in foreign currencies are translated to the functional currency of the Group at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies

F-3

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(17)

Transactions in foreign currencies, Continued

(a)

Foreign currency transactions, Continued

are retranslated to the functional currency using the exchange rate at the reporting date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined.

Exchange differences arising from the translation of monetary items are recognized in profit or loss, except for those relating to investments in equity instruments designated at fair value through other comprehensive income, those arising from the translation of net investments in foreign operations, and those arising from financial liabilities designated as cash flow hedging item. If a gain or loss on a non-monetary item is recognized in other comprehensive income, any foreign exchange differences are also recognized in other comprehensive income. When a gain or loss on a non-monetary item is recognized in profit or loss, any foreign exchange differences are also recognized in profit or loss.

(b)

Foreign operations

If the presentation currency of the Group is different from a foreign operation’s functional currency, the financial statements of the foreign operation are translated into the presentation currency using the following methods:

The assets and liabilities of foreign operations, whose functional currency is not the currency of a hyperinflationary economy, are translated to presentation currency at exchange rates at the reporting date. The income and expenses of foreign operations are translated to functional currency at exchange rates at the dates of the transactions. Foreign currency differences are recognized in other comprehensive income.

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of that foreign operation is treated as assets and liabilities of the foreign operation. Thus, they are expressed in the functional currency of the foreign operation and translated at the closing rate at the reporting date.

When a foreign operation is disposed, the relevant amount in the translation is transferred to profit or loss as part of the profit or loss on disposal. On the partial disposal of a subsidiary that includes a foreign operation, the relevant proportion of such cumulative amount is reattributed to non-controlling interest. In any other partial disposal of a foreign operation, the relevant proportion is reclassified to profit or loss.

(18)

Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

When the Parent Company repurchases its own shares, the amount of the consideration paid is recognized as a deduction from equity and classified as treasury shares. The gains or losses from the purchase, disposal, reissue, or retirement of treasury shares are directly recognized in equity being as transaction with owners.

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(19)

Hybrid bond

The Group recognizes a financial instrument issued by the Group as an equity instrument if it does not include contractual obligation to deliver financial assets including cash to the counter party.

(20)

Share-based payment

For equity-settled share-based payment transaction, if the fair value of the goods or services received cannot be reliably estimated, the Group measures the value indirectly by reference to the fair value of the equity instruments granted. The related expense with a corresponding increase in capital surplus and others is recognized over the vesting period of the awards.

The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognized is based on the number of awards that meet the related service and non-market performance conditions at the vesting date.

The fair value of the amount payable to employees in respect of share appreciation rights, which are settled in cash, is recognized as an expense with a corresponding increase in liabilities, over the period in which the employees become unconditionally entitled to payment. The liability is remeasured at each reporting date and at settlement date based on the fair value of the share appreciation rights. Any changes in the fair value of the liability are recognized in profit or loss.

(21)

Revenue

(a)

Identification of performance obligations in contracts with customers

The Group identifies the distinct services or goods as performance obligations in contracts with customers such as (1) providing wireless and fixed-line telecommunications services, (2) sale of handsets and (3) providing other goods and services. In the case of providing both wireless telecommunications service and selling a handset together to one customer, the Group allocates considerations from the customer between the separate performance obligations for handset sale and wireless telecommunications service. The handset sale revenue is recognized when handset is delivered, and the wireless telecommunications service revenue is recognized over the period of the contract term as stated in the subscription contract.

(b)

Allocation of the transaction price to each performance obligation

The Group allocates the transaction price to each performance obligation based on the relative stand-alone selling prices. Stand-alone selling prices are estimated using the “adjusted market assessment approach”, which considers market conditions and prices for similar goods or services.

(c)

Incremental costs of obtaining a contract

The Group pays commissions to its retail stores and authorized dealers in connection with acquiring service contracts. The commissions paid to these parties constituted a significant portion of the Group’s operating expenses. As these commissions would not have been incurred if the related contracts had not been obtained, the Group capitalizes the incremental costs of obtaining customer contracts and amortizes them over the expected contract periods.

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(21)

Revenue, Continued

(d)

Customer loyalty programs

The Group grants customer loyalty points to customers based on their service usage. The loyalty points provide customers with a material right and are therefore treated as a separate performance obligation. The amount of the transaction price allocated to the loyalty program is measured based on the relative stand-alone selling price of the customer loyalty points. The allocated amount is recognized as a contract liability and is subsequently recognized as revenue when loyalty points are redeemed or when the likelihood of redemption becomes remote.

(e)

Consideration payable to a customer

Based on the subscription contract, a customer who uses the Group’s wireless telecommunications services may receive a discount for purchasing goods or services from a designated third party. The Group pays a portion of the price discounts that the customer receives to the third party which is viewed as consideration payable to a customer. The Group accounts for the amounts payable to the third party as a reduction of the wireless telecommunications service revenue.

(22)

Finance income and finance costs

Finance income comprises interest income on funds invested (including financial assets measured at fair value), dividend income, gains on disposal of financial assets at FVTPL, changes in fair value of financial instruments at FVTPL, and gains on hedging instruments that are recognized in profit or loss. Interest income is recognized as it accrues in profit or loss, using the effective interest rate method. Dividend income is recognized in profit or loss when the right to receive the dividend is established.

Finance costs comprise interest expense on borrowings and debentures, changes in fair value of financial instruments at FVTPL, and losses on hedging instruments that are recognized in profit or loss. Interest expense on borrowings and debentures is recognized as it accrues in profit or loss using the effective interest rate method.

(23)

Income taxes

Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity or in OCI.

The Group pays income tax in accordance with the tax-consolidation system when the Parent Company and its subsidiaries are economically unified.

(a)

Current tax

Current tax is the expected tax payable or receivable on the taxable profit or loss for the year, using tax rates enacted or substantively enacted at the end of the reporting period, and includes interests and fines related to income taxes paid or payable. The taxable profit is different from the accounting profit

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(23)

Income taxes, Continued

(a)

Current tax, Continued

for the period since the taxable profit is calculated excluding the temporary differences, which will be taxable or deductible in determining taxable profit (tax loss) of future periods, and non-taxable or non-deductible items from the accounting profit.

(b)

Deferred tax

Deferred tax is recognized by using the asset-liability method in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The Group recognizes a deferred tax liability for all taxable temporary differences, except for the difference associated with investments in subsidiaries and associates that the Group is able to control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. The Group recognizes a deferred tax asset for all deductible temporary differences to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilized.

A deferred tax asset is recognized for the carryforward of unused tax losses and unused tax credits to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused tax credits can be utilized. Future taxable profit is dependent on the reversal of taxable temporary differences. If there are insufficient taxable temporary differences to recognize the deferred tax asset, the business plan of the Group and the reversal of existing temporary differences are considered in determining the future taxable profit.

The Group reviews the carrying amount of a deferred tax asset at the end of each reporting period and reduces the carrying amount to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized, or the liability is settled based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and deferred tax assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if the Group has a legally enforceable right to offset the amount recognized and intends to settle the current tax liabilities and assets on a net basis. Income tax expense in relation to dividend payments is recognized when liabilities relating to the dividend payments are recognized.

(c)

Uncertainty over income tax treatments

The Group assesses the uncertainty over income tax treatments pursuant to IAS 12. If the Group concludes it is not probable that the taxation authority will accept an uncertain tax treatment, the Group reflects the effect of uncertainty for each uncertain tax treatment by using either of the following

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

3.	Material Accounting Policies, Continued

(23)

Income taxes, Continued

(c)

Uncertainty over income tax treatments, Continued

methods, depending on which method the entity expects to better predict the resolution of the uncertainty:

•

The most likely amount: the single most likely amount in a range of possible outcomes.

•

The expected value: the sum of the

probability-weighted

amounts in a range of possible outcomes.

(24)

Earnings per share

The Group calculates basic and diluted earnings per share with respect to profit or loss from continuing operations and of the year, and presents them in the consolidated statement of income. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Parent Company by the weighted average number of ordinary shares outstanding during the period, adjusted for own shares held. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding, adjusted for own shares held, for the effects of all dilutive potential ordinary shares, which comprise share options granted to employees, if any.

(25)

Discontinued operation

A discontinued operation is a component of the Group’s business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which:

•

represents a separate major line of business or geographic area of operations;

•

is part of a single co-ordinated plan to dispose of a separate major line of business or geographic area of operations; or

•

is a subsidiary acquired only for a purpose of resale.

When an operation is classified as a discontinued operation, the comparative statements of income and comprehensive income are re-presented as if the operation had been discontinued from the start of the comparative year.

(26)

Standards issued but not yet effective

The new and amended standards and interpretations that are issued, but not yet effective for annual period beginning after January 1, 2025 are disclosed below. The Group is currently assessing the impact of these issuances and amendments on its consolidated financial statements.

•

Classification and measurement of financial instruments (Amendments to IFRS 9 ‘

Financial Instruments

’ and IFRS 7 ‘

Financial Instruments: Disclosures

’)

•

Contracts referencing nature-dependent electricity (Amendments to IFRS 9 ‘

Financial Instruments

’ and IFRS 7 ‘

Financial Instruments: Disclosures

’)

•

IFRS 18 ‘

Presentation and Disclosures in Financial Statements

’ and amendments to IFRS 18

•

Annual Improvements to IFRS - Volume 11

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

4.	Operating Segments

The Group’s operating segments have been identified to be each business unit, by which the Group provides different services and sells merchandise. The Group’s reportable segments include: cellular services, which mainly include cellular voice service, wireless data service and wireless internet services; fixed-line telecommunication services, which mainly include telephone services, internet services, and leased line services; and all other businesses, which include providing shopping channel and digital platform for selling products and other immaterial operations, each of which does not meet the quantitative threshold to be considered as a reportable segment and are presented collectively as others.

(1)

Segment information for the years ended December 31, 2025, 2024 and 2023 are as follows:



(In millions of won)
	2025
	Cellular services		Fixed-line telecommunication services		Others			Sub-total		Adjustments (*)			Total
Total revenue	₩	14,155,266		5,421,288		390,147			19,966,701		(2,867,488	)		17,099,213
Inter-segment revenue		1,602,723		1,230,175		34,590			2,867,488		(2,867,488	)		—
External revenue		12,552,543		4,191,113		355,557			17,099,213		—			17,099,213
Depreciation and amortization		2,551,737		993,930		18,979			3,564,646		(97,512	)		3,467,134
Operating profit (loss)		817,941		308,372		(30,551	)		1,095,762		(47,261	)		1,048,501
Finance income (costs), net														(262,638	)
Loss relating to investments in subsidiaries, associates and joint ventures, net														(63,602	)
Profit before income tax														722,261

(In millions of won)
	2024
	Cellular services		Fixed-line telecommunication services		Others			Sub-total		Adjustments (*)			Total
Total revenue	₩	14,866,217		5,271,705		614,036			20,751,958		(2,811,349	)		17,940,609
Inter-segment revenue		1,548,004		1,196,293		67,052			2,811,349		(2,811,349	)		—
External revenue		13,318,213		4,075,412		546,984			17,940,609		—			17,940,609
Depreciation and amortization		2,688,764		966,904		25,824			3,681,492		(121,118	)		3,560,374
Operating profit (loss)		1,529,971		366,517		(64,929	)		1,831,559		(140,697	)		1,690,862
Finance income (costs), net														(250,884	)
Gain relating to investments in subsidiaries, associates and joint ventures, net														321,787
Profit before income tax														1,761,765

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

4.	Operating Segments, Continued

(1)

Segment information for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:



(In millions of won)
	2023
	Cellular services		Fixed-line telecommunication services		Others			Sub-total		Adjustments (*)			Total
Total revenue	₩	14,664,180		5,095,704		603,493			20,363,377		(2,754,866	)		17,608,511
Inter-segment revenue		1,541,014		1,167,684		46,168			2,754,866		(2,754,866	)		—
External revenue		13,123,166		3,928,020		557,325			17,608,511		—			17,608,511
Depreciation and amortization		2,743,448		971,628		24,390			3,739,466		(124,700	)		3,614,766
Operating profit (loss)		1,463,934		329,072		(42,771	)		1,750,235		6,041			1,756,276
Finance income (costs), net														(279,025	)
Gain relating to investments in subsidiaries, associates and joint ventures, net														10,928
Profit before income tax														1,488,179

(*)

Adjustments for operating profit (loss) are the amount differences from operating profit (loss) included in CODM report which is based on Korean IFRS to operating profit (loss) under IFRS. The reconciliation of these amounts is included in note

4-(2).

Adjustments for depreciation and amortization and operating profit (loss) also included the amount due to the consolidation adjustments, such as internal transactions.

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

4.	Operating Segments, Continued

(2)

Reconciliation of total segment operating profit to consolidated operating profit for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025			2024			2023
Total segment operating profit (Before adjustments)	₩	1,095,762			1,831,559			1,750,235
Adjustments(*1)		(22,547	)		(8,150	)		2,969

Total segment operating profit		1,073,215			1,823,409			1,753,204

Other operating income:
Gain on disposal of property and equipment and intangible assets		127,058			37,316			21,898
Others		43,376			34,972			28,468

		170,434			72,288			50,366
Other operating expenses:
Impairment loss on property and equipment and intangible assets		(3,140	)		(94,736	)		(10,369	)
Impairment loss on assets held for sale		(12,320	)		—			—
Loss on disposal of property and equipment and intangible assets		(15,296	)		(17,427	)		(9,369	)
Donations		(15,339	)		(15,712	)		(14,766	)
Bad debt for accounts receivable – other		(3,282	)		(4,838	)		(5,256	)
Others(*2)		(145,771	)		(72,122	)		(7,534	)

		(195,148	)		(204,835	)		(47,294	)

Consolidated operating profit	₩	1,048,501			1,690,862			1,756,276

(*1)

Adjustments for operating profit included the amount due to the consolidation adjustments, such as internal transactions.

(*2)

Others for the years ended December 31, 2025 and 2024 include ₩134.8 billion and ₩55.4 billion of penalties, respectively, and various other expenses with inconsequential amounts.

Domestic revenue for the years ended December 31, 2025, 2024 and 2023 amounts to ₩17,096 billion, ₩17,936 billion and ₩17,602 billion, respectively. Domestic

non-current

assets (excluding financial assets, investments in associates and joint ventures and deferred tax assets) as of December 31, 2025, 2024 and 2023 amount to ₩17,281 billion, ₩18,230 billion and ₩19,285 billion, and

non-current

assets outside of Korea amount to ₩5 billion, ₩3 billion and ₩3 billion, respectively.

The Group principally operates its businesses in Korea, and substantially all of its operations are conducted in Korea, with activities outside Korea being immaterial. Therefore, no entity-wide geographical information is presented.

No single customer contributed 10% or more to the Group’s total revenue for the years ended December 31, 2025, 2024 and 2023.

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

4.	Operating Segments, Continued

(3)

Disaggregation of operating revenues considering the economic factors that affect the nature, amounts, timing and uncertainty of the Group’s revenue and future cash flows is as follows:


(In millions of won)
		2025		2024		2023
Goods and Services transferred at a point in time:
Cellular revenue	Goods and others(*1)	₩	1,034,695		1,078,673		993,919
Fixed-line telecommunication revenue	Goods and others		86,249		68,836		93,174
Other revenue	Others(*2)		325,417		468,518		459,905

			1,446,361		1,616,027		1,546,998

Goods and Services transferred over time:
Cellular revenue	Wireless service(*3)		9,715,601		10,401,565		10,328,980
	Cellular interconnection		369,870		400,516		432,660
	Other(*4)		1,432,377		1,437,459		1,367,607
Fixed-line telecommunication revenue	Fixed-line service		142,500		156,453		147,669
	Cellular interconnection		12,384		14,014		15,804
	Internet Protocol Television(*5)		1,806,840		1,837,199		1,837,209
	International calls		200,860		213,745		190,872
	Internet service and miscellaneous(*6)		1,942,280		1,785,165		1,643,292
Other revenue	Miscellaneous		30,140		78,466		97,420

			15,652,852		16,324,582		16,061,513

		₩	17,099,213		17,940,609		17,608,511

(*1)

Cellular revenue includes revenue from sales of handsets and other electronic accessories.

(*2)

Other revenue includes revenue from considerations received for providing data-broadcasting channel and broadcasting services for product sale programs, as well as revenue from the sale of goods through data-broadcasting channel.

(*3)

Wireless service revenue includes revenue from wireless voice and data transmission services, which is collected from the wireless subscribers. During the year ended December 31, 2025, the wireless service revenue was reduced by ₩454,143 million

reflecting the impact of Customer Appreciation Package and early cancellation fee waivers provided to customers as part of the measures taken in response to a cybersecurity incident related to cellular services segment.

(*4)

Other revenue includes revenue from billing and collection services, solution services, and other miscellaneous services.

(*5)

Internet Protocol Television (“IPTV”) service revenue includes revenue from IPTV services principally derived from usage charges to IPTV subscribers.

(*6)

Internet service and miscellaneous revenue includes revenue from high speed broadband internet service principally derived from usage charges to subscribers as well as other miscellaneous services.

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

5.	Deposits with Restrictions on Use

Deposits which are restricted in use as of December 31, 2025 and 2024 are summarized as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Short-term financial instruments(*)	₩	90,163		79,500
Long-term financial instruments(*)		370		372

	₩	90,533		79,872

(*)

Financial instruments includes the charitable trust fund established by the Group, which cannot be withdrawn before maturity, and the deposits received under the share purchase agreements for the sale of shares in SK stoa Co., Ltd. and Media S Co., Ltd.

6.	Trade and Other Receivables

(1)

Details of trade and other receivables as of December 31, 2025 and 2024 are as follows:


(In millions of won)	December 31, 2025
	Gross amount		Loss allowance			Carrying amount
Current assets:
Accounts receivable – trade	₩	2,185,983		(267,481	)		1,918,502
Short-term loans		70,271		(607	)		69,664
Accounts receivable – other(*)		366,785		(20,459	)		346,326
Accrued income		1,998		—			1,998
Guarantee deposits (Other current assets)		102,396		—			102,396

		2,727,433		(288,547	)		2,438,886
Non-current assets:
Long-term loans		51,431		(19,247	)		32,184
Long-term accounts receivable – other		164,762		—			164,762
Guarantee deposits		167,823		—			167,823
Long-term accounts receivable – trade (Other non-current assets)		8,402		(1	)		8,401

		392,418		(19,248	)		373,170

	₩	3,119,851		(307,795	)		2,812,056

(*)

Gross and carrying amounts of accounts receivable – other as of December 31, 2025 include ₩189,963 million of financial instruments classified as fair value through profit or loss (“FVTPL”).

F-4

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

6.	Trade and Other Receivables, Continued

(1)

Details of trade and other receivables as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)	December 31, 2024
	Gross amount		Loss allowance			Carrying amount
Current assets:
Accounts receivable – trade	₩	2,247,334		(258,028	)		1,989,306
Short-term loans		65,767		(562	)		65,205
Accounts receivable – other(*)		394,820		(25,628	)		369,192
Accrued income		4,242		—			4,242
Guarantee deposits (Other current assets)		119,575		—			119,575

		2,831,738		(284,218	)		2,547,520
Non-current assets:
Long-term loans		75,842		(41,396	)		34,446
Long-term accounts receivable – other		173,252		—			173,252
Guarantee deposits		155,875		—			155,875
Long-term accounts receivable – trade (Other non-current assets)		11,078		(2	)		11,076

		416,047		(41,398	)		374,649

	₩	3,247,785		(325,616	)		2,922,169

(*)

Gross and carrying amounts of accounts receivable – other as of December 31, 2024 include ₩223,761 million of financial instruments classified as fair value through profit or loss (“FVTPL”).

(2)

Changes in the loss allowance on accounts receivable – trade measured at amortized costs for the years ended December 31, 2025 and 2024 are as follows:


	Beginning balance		Impairment		Write- offs(*)			Collection of receivables previously written-off		Ending balance
2025	₩	258,030		44,183		(42,484	)		7,753		267,482
2024	₩	242,737		49,865		(42,662	)		8,090		258,030

(*)

The Group writes off the trade and other receivables that are determined to be uncollectable due to reasons such as termination of operations or bankruptcy.

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

6.	Trade and Other Receivables, Continued

(3)

The Group applies the practical expedient that allows the Group to estimate the loss allowance for accounts receivable – trade at an amount equal to the lifetime expected credit losses. The expected credit losses include the forward-looking information. To make the assessment, the Group uses its historical credit loss experience over the past three years and classifies the accounts receivable – trade by their credit risk characteristics and days overdue. Details of loss allowance on accounts receivable – trade and information on days overdue as of December 31, 2025 are as follows:


(In millions of won)
		Less than 6 months			6 months ~ 1 year			1 ~ 3 years			More than 3 years
Telecommunications service revenue	Expected credit loss rate		1.58	%		73.47	%		90.76	%		99.99	%
	Gross amount	₩	1,413,007			56,639			150,448			25,965
	Loss allowance		22,393			41,615			136,546			25,964

Other revenue	Expected credit loss rate		2.78	%		53.91	%		62.41	%		93.48	%
	Gross amount	₩	514,691			5,170			8,827			19,638
	Loss allowance		14,310			2,787			5,509			18,358

Due to the nature of its business, which involves both fixed-line and wireless telecommunications, the Group’s accounts receivables from telecommunications revenue primarily consist of receivables from individual customers. As there are no significant differences in credit terms among customers, there is no material concentration of credit risk.

Receivables related to other revenue mainly consist of receivables from corporate customers. The Group transacts only with corporate customers whose credit risk is assessed as low. In addition, the Group is not exposed to significant credit concentration risk as the Group monitors the credit ratings of these customers on a regular basis and evaluates their creditworthiness accordingly. Although contract assets are subject to the expected credit loss assessment, no significant credit risk has been identified.

7.	Prepaid expenses

The Group pays commissions to its retail stores and authorized dealers, primarily for wireless and fixed-line telecommunication services based on their performance of attracting new customers and renewing contracts with existing customers. The Group recognizes costs among the commissions that would not have incurred if a contract had not been entered into with a customer as prepaid expenses. These prepaid expenses are amortized on a straight-line basis over the expected customer retention periods.

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

7.	Prepaid expenses, Continued

(1)

Details of prepaid expenses as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Current assets:
Incremental costs of obtaining contracts	₩	2,061,667		1,881,608
Others		74,096		64,002

	₩	2,135,763		1,945,610

Non-current assets:
Incremental costs of obtaining contracts	₩	1,208,600		1,038,170
Others		72,151		70,236

	₩	1,280,751		1,108,406

(2)

Incremental costs of obtaining contracts

Amortization in connection with incremental costs of obtaining contracts recognized as an asset for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Amortization recognized	₩	2,596,632		2,493,346		2,505,724

8.	Contract Assets and Liabilities

In case of providing both wireless telecommunication services and sales of handsets, the Group allocated the consideration based on relative stand-alone selling prices and recognized unbilled receivables from handset sales as contract assets. The Group recognized receipts in advance for prepaid telecommunications services and solution services, and unearned revenue for customer loyalty programs as contract liabilities.

(1)

Details of contract assets and liabilities as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Contract assets	₩	188,609		136,737
Contract liabilities:
Wireless service contracts		21,807		20,275
Customer loyalty programs		5,920		5,694
Fixed-line service contracts		288,421		151,427
Others		85,795		52,310

	₩	401,943		229,706

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

8.	Contract Assets and Liabilities, Continued

(2)

Amounts of revenue recognized for the years ended December 31, 2025 and 2024 related to the contract liabilities carried forward from the prior periods are ₩145,572 million and ₩113,792 million, respectively. Details of revenue expected to be recognized from contract liabilities as of December 31, 2025 are as follows:


(In millions of won)
	Less than 1 year		1 ~ 2 years		More than 2 years		Total
Wireless service contracts	₩	21,807		—		—		21,807
Customer loyalty programs		4,221		1,138		561		5,920
Fixed-line service contracts		95,859		22,489		170,073		288,421
Others		85,795		—		—		85,795

	₩	207,682		23,627		170,634		401,943

9.	Inventories

(1)

Details of inventories as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025							December 31, 2024
	Acquisition cost		Valuation allowance			Carrying amount		Acquisition cost		Valuation allowance			Carrying amount
Merchandise	₩	160,996		(6,942	)		154,054		191,323		(8,121	)		183,202
Supplies		13,586		—			13,586		26,581		—			26,581

	₩	174,582		(6,942	)		167,640		217,904		(8,121	)		209,783

(2)

Amounts of the inventory write-downs and

write-off

of inventories charged to statement of income are as follows:


(In millions of won)
	2025		2024			2023
Charged to cost of products that have been resold	₩	66		1,592			2,033
Write-off upon sale		—		(1,106	)		(8	)

There are no significant reversals of inventory write-downs for the periods presented.

(3)

Inventories recognized as operating expenses for the years ended December 31, 2025, 2024, and 2023 are ₩1,267,120 million, ₩1,323,907 million, and ₩1,264,302 million, respectively, which are included in the cost of goods sold.

10.	Investment Securities

(1)

Details of short-term investment securities as of December 31, 2025 are as follows:


(In millions of won)
	Category		December 31, 2025
Beneficiary certificates		FVTPL	₩	35,217

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

10.	Investment Securities, Continued

(2)

Details of long-term investment securities as of December 31, 2025 and 2024 are as follows:

(In millions of won)

Category

December 31, 2025

December 31, 2024

Equity instruments

FVOCI(*)

₩

3,025,988

1,739,133

Debt instruments

FVTPL

162,584

138,789

₩

3,188,572

1,877,922

(*)

The Group designated investments in equity instruments that are not held for trading as financial assets at FVOCI.

11.	Investments in Associates and Joint Ventures

(1)

Investments in associates and joint ventures accounted for using the equity method as of December 31, 2025 and 2024 are as follows:


(In millions of won)		December 31, 2025				December 31, 2024
	Country	Ownership (%)		Carrying amount		Ownership (%)		Carrying amount
Investments in associates:
SK China Company Ltd.	China		27.3	₩	1,045,903		27.3	₩	975,443
Korea IT Fund(*1)	Korea		63.3		370,482		63.3		363,138
UniSK	China		49.0		26,442		49.0		26,031
SK Technology Innovation Company	Cayman Islands		49.0		33,523		49.0		34,516
SK MENA Investment B.V.(*2)	Netherlands		32.1		6,612		32.1		17,273
SK Latin America Investment S.A.(*3)	Spain		—		—		32.1		1,357
SK South East Asia Investment Pte. Ltd.	Singapore		20.0		368,776		20.0		391,572
Citadel Pacific Telecom Holdings, LLC(*4)	USA		15.0		55,167		15.0		51,780
SM Culture & Contents Co., Ltd.	Korea		22.8		29,305		22.8		39,567
Nam Incheon Broadcasting Co., Ltd.(*5)	Korea		—		—		27.3		15,635
Home Choice Corp.(*4)	Korea		17.8		2,773		17.8		3,238
Konan Technology Inc.(*4)	Korea		18.9		5,070		20.6		3,575
CMES Inc.(*4)	Korea		6.5		6,999		6.6		4,772
SK telecom Japan Inc.	Japan		24.9		3,629		24.9		3,703
Rebellions Inc. (Formerly, SAPEON Korea Inc.)(*4)	Korea		18.2		187,466		26.1		298,327
SK m&service Co., Ltd(*6)	Korea		30.0		24,551		—		—
Start-up Win-Win Fund and others(*4,7,8)	—		—		65,661		—		102,702

				₩	2,232,359			₩	2,332,629

Investments in joint ventures:
UTC Kakao-SK Telecom ESG Fund(*9)	Korea		48.2		6,111		48.2		9,198

				₩	2,238,470			₩	2,341,827

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(1)

Investments in associates and joint ventures accounted for using the equity method as of December 31, 2025 and 2024 are as follows, Continued:

(*1)

Investment in Korea IT Fund was classified as investment in associates as the Group does not have control over the investee under the contractual agreement with other shareholders.

(*2)

The Group received ₩10,955 million from the

paid-in

capital reduction of SK MENA Investment B.V. for the year ended December 31, 2025, with no change in ownership interest.

(*3)

The Group is expected to receive ₩1,394 million from the liquidation of SK Latin America Investment S.A. and recognized a ₩282 million loss relating to investments in associates for the year ended December 31, 2025.

(*4)

These investments were classified as investments in associates as the Group can exercise significant influence through its right to appoint the members of the board of directors even though the Group has less than 20% of equity interests.

(*5)

The Group received ₩4,000 million from the

paid-in

capital reduction of Nam Incheon Broadcasting Co., Ltd. and recognized a ₩11,791 million loss relating to investments in associates for the year ended December 31, 2025.

(*6)

The Group disposed of a portion of shares in SK m&service Co., Ltd., which was an indirect subsidiary of the Parent Company, to SAMKOO Inc. and received ₩54,987 million for the year ended December 31, 2025. As a result, the remaining shares have been reclassified as an investment in associate as of December 31, 2025.

(*7)

The Group exchanged its entire shares in id Quantique SA for shares in IonQ, Inc., and recognized a ₩1,189 million loss relating to investments in associates for the year ended December 31, 2025.

(*8)

The Group newly contributed ₩10,596 million in cash to Syntelligence AI Ltd. for the year ended December 31, 2025.

(*9)

This investment was classified as investment in joint ventures as the Group has joint control pursuant to the agreement with the other shareholders.

(2)

Market value of investments in listed associates as of December 31, 2025 and 2024 are as follows:


(In millions of won, except for share data)
	December 31, 2025						December 31, 2024
	Market price per share (in won)		Number of shares		Market value		Market price per share (in won)		Number of shares		Market value
SM Culture & Contents Co., Ltd.	₩	1,330		22,033,898		29,305		1,400		22,033,898		30,847
Konan Technology Inc.		19,710		2,359,160		46,499		19,470		2,359,160		45,933
CMES Inc.		33,100		763,968		25,287		24,000		763,968		18,335

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(3)

The condensed financial information of material associates as of and for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	Korea IT Fund		SK China Company Ltd. (*1)		SK South East Asia Investment Pte. Ltd.(*1)		Rebellions Inc. (Formerly, SAPEON Korea Inc.)(*1,2)
	As of December 31, 2025
Current assets	₩	183,750		1,787,188		1,012,134		392,333
Non-current assets		401,222		2,120,977		965,785		295,580
Current liabilities		—		39,402		42,226		912,220
Non-current liabilities		—		407,230		31,791		10,420

	For the year ended December 31, 2025
Revenue	₩	40,134		68,245		132,567		32,022
Profit (loss) for the period		21,343		42,909		1,806		(204,898	)
Other comprehensive income		4,232		239,747		12,323		219
Total comprehensive income (loss)		25,575		282,656		14,129		(204,679	)


(In millions of won)
	Korea IT Fund		SK China Company Ltd.(*1)			SK South East Asia Investment Pte. Ltd.(*1)
	As of December 31, 2024
Current assets	₩	164,128		1,755,237			1,724,220
Non-current assets		409,248		1,898,657			1,328,952
Current liabilities		—		48,662			342,671
Non-current liabilities		—		328,485			18,430

	For the year ended December 31, 2024
Revenue	₩	57,110		71,870			119,019
Profit (loss) for the year		37,187		55,448			(54,649	)
Other comprehensive income (loss)		13,006		(156,828	)		(3,972	)
Total comprehensive income (loss)		50,193		(101,380	)		(58,621	)

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(3)

The condensed financial information of material associates as of and for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:


(In millions of won)
	Korea IT Fund		SK China Company Ltd.(*1)			SK South East Asia Investment Pte. Ltd.(*1)
	As of December 31, 2023
Current assets	₩	128,344		1,350,607			213,522
Non-current assets		402,819		1,987,252			3,034,553
Current liabilities		—		99,083			502,728
Non-current liabilities		—		252,100			13,586

	For the year ended December 31, 2023
Revenue	₩	33,017		70,126			76,686
Profit (loss) for the year		16,330		87,462			(66,169	)
Other comprehensive income (loss)		5,316		(56,660	)		2,779
Total comprehensive income (loss)		21,646		30,802			(63,390	)

(*1)

The financial information of SK China Company Ltd., SK South East Asia Investment Pte. Ltd. and Rebellions Inc. (Formerly, SAPEON Korea Inc.) are consolidated financial information.

(*2)

The financial information includes the goodwill held by Rebellions Inc. (formerly, SAPEON Korea Inc.), which was recognized as part of the identifiable net assets of the associate at the time the investment in the associate was made.

(4)

There are no material joint ventures as of December 31, 2025, 2024 and 2023.

(5)

Reconciliations of financial information of material associates to carrying amounts of investments in associates in the consolidated financial statements as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025
	Net assets			Ownership interests (%)		Net assets attributable to the ownership interests			Cost-book value differentials		Carrying amount
Korea IT Fund	₩	584,972			63.3		370,482			—		370,482
SK China Company Ltd.		3,461,533			27.3		944,111			101,792		1,045,903
SK South East Asia Investment Pte. Ltd.(*1)		1,843,880			20.0		368,776			—		368,776
Rebellions Inc. (Formerly, SAPEON Korea Inc.)(*2,3)		(462,479	)		18.2		(163,255	)		350,721		187,466

(*1)

Net assets of the entity represent net assets excluding those attributable to the

non-controlling

interests.

(*2)

Net assets of the entity exclude the goodwill held by Rebellions Inc. (formerly, SAPEON Korea Inc.) at the time the investment in the associate was recognized.

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(5)

(*3)

The ownership interest is based on the number of shares owned by the Parent Company divided by the total shares issued by the investee, and the effective ownership interest applied for the equity method is 35.3% as of December 31, 2025.


(In millions of won)
	December 31, 2024
	Net assets		Ownership interests (%)		Net assets attributable to the ownership interests		Cost-book value differentials		Carrying amount
Korea IT Fund	₩	573,376		63.3		363,138		—		363,138
SK China Company Ltd.		3,276,747		27.3		893,609		81,834		975,443
SK South East Asia Investment Pte. Ltd.(*)		1,957,860		20.0		391,572		—		391,572

(*)

Net assets of the entity represent net assets excluding those attributable to the

non-controlling

interest.

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(6)

Changes in investments in associates and joint ventures accounted for using the equity method for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)	2025
	Beginning balance		Acquisition and disposal			Share of profit (loss)			Other compre- hensive income (loss)			Other changes			Ending balance
Investments in associates:
SK China Company Ltd.	₩	975,443		—			9,707			60,753			—			1,045,903
Korea IT Fund(*1)		363,138		—			13,519			2,681			(8,856	)		370,482
UniSK(*1)		26,031		—			215			450			(254	)		26,442
SK Technology Innovation Company		34,516		(1,363	)		1,242			(872	)		—			33,523
SK MENA Investment B.V.		17,273		(11,041	)		401			(21	)		—			6,612
SK Latin America Investment S.A.		1,357		(1,676	)		191			128			—			—
SK South East Asia Investment Pte. Ltd.		391,572		—			(1,710	)		(21,086	)		—			368,776
Citadel Pacific Telecom Holdings, LLC(*1)		51,780		—			185			4,640			(1,438	)		55,167
SM Culture & Contents Co., Ltd.		39,567		—			(4,220	)		(153	)		(5,889	)		29,305
Nam Incheon Broadcasting Co., Ltd.(*1)		15,635		(15,791	)		293			—			(137	)		—
Home Choice Corp.		3,238		—			(465	)		—			—			2,773
Konan Technology Inc.		3,575		3,535			(2,040	)		—			—			5,070
CMES Inc.		4,772		3,374			(1,216	)		69			—			6,999
SK telecom Japan Inc.		3,703		—			247			(321	)		—			3,629
Rebellions Inc. (Formerly, SAPEON Korea Inc.)		298,327		(33,620	)		(77,610	)		369			—			187,466
SK m&service Co., Ltd(*2)		—		—			1,037			(52	)		23,566			24,551
Start-up Win-Win Fund and others(*1,3,4)		102,702		10,253			3,458			(622	)		(50,130	)		65,661

		2,332,629		(46,329	)		(56,766	)		45,963			(43,138	)		2,232,359
Investments in joint ventures:
UTC Kakao-SK Telecom ESG Fund		9,198		(2,000	)		(1,087	)		—			—			6,111

	₩	2,341,827		(48,329	)		(57,853	)		45,963			(43,138	)		2,238,470

(*1)

Dividends received from the associates are deducted from the carrying amount for the year ended December 31, 2025.

(*2)

The Group disposed of a portion of shares in SK m&service Co., Ltd., which was an indirect subsidiary of the Parent Company, for the year ended December 31, 2025, resulting in the reclassification of the remaining shares as an investment in associate as of December 31, 2025.

(*3)

The Group exchanged its entire shares in id Quantique SA for shares in IonQ, Inc. and classified the investment in IonQ, Inc. as a financial asset at FVOCI for the year ended December 31, 2025.

(*4)

The acquisition for the year ended December 31, 2025 includes ₩10,596 million of investments in Syntelligence AI Ltd.

F-5

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(6)

Changes in investments in associates and joint ventures accounted for using the equity method for the years ended December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)	2024
	Beginning balance		Acquisition and disposal			Share of profit (loss)			Other compre- hensive income (loss)			Other changes			Ending balance
Investments in associates:
SK China Company Ltd.	₩	896,990		—			8,913			69,540			—			975,443
Korea IT Fund(*1)		336,404		—			23,552			8,237			(5,055	)		363,138
UniSK		22,285		—			1,430			2,815			(499	)		26,031
SK Technology Innovation Company		70,409		—			4,269			8,078			(48,240	)		34,516
SK MENA Investment B.V.		14,872		—			329			2,072			—			17,273
SK Latin America Investment S.A.		14,607		—			(65	)		1,268			(14,453	)		1,357
SK South East Asia Investment Pte. Ltd.		355,282		—			(9,403	)		45,693			—			391,572
Citadel Pacific Telecom Holdings, LLC(*1)		45,901		—			619			6,699			(1,439	)		51,780
SM Culture & Contents Co., Ltd.		41,578		(3	)		(1,880	)		(128	)		—			39,567
Nam Incheon Broadcasting Co., Ltd.(*1)		14,344		—			1,427			—			(136	)		15,635
Home Choice Corp.		3,215		—			23			—			—			3,238
Konan Technology Inc.		6,349		(16	)		(2,861	)		103			—			3,575
CMES Inc.		900		(4,396	)		(767	)		51			8,984			4,772
SK telecom Japan Inc.		1,239		1,560			(983	)		1,887			—			3,703
Rebellions Inc. (Formerly, SAPEON Korea Inc.)(*2)		—		—			—			—			298,327			298,327
Start-up Win-Win Fund and others(*1,3,4)		81,142		(2,953	)		(1,686	)		2,793			23,406			102,702

		1,905,517		(5,808	)		22,917			149,108			260,895			2,332,629
Investments in joint ventures:
UTC Kakao-SK Telecom ESG Fund		9,495		—			(297	)		—			—			9,198

	₩	1,915,012		(5,808	)		22,620			149,108			260,895			2,341,827

(*1)

Dividends received from the associates are deducted from the carrying amount for the year ended December 31, 2024.

(*2)

The Group lost control of SAPEON Korea Inc., which was a subsidiary of the Parent Company, for the year ended December 31, 2024, due to a decreased ownership resulting from the merger between SAPEON Korea Inc. and Rebellions Inc. As a result, the entity was reclassified as an investment in associate for the year ended December 31, 2024.

(*3)

The acquisition for the year ended December 31, 2024 includes ₩5,878 million of investments in SK AMERICAS Inc. (formerly, SK USA Inc.), ₩180 million of investment in SK VENTURE CAPITAL, LLC., ₩273 million of investment in WALDEN SKT VENTURE FUND, ₩24 million of investment in F&U Credit information Co., Ltd. and ₩1,294 million of investment in AhnLab Blockchain

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

11.	Investments in Associates and Joint Ventures, Continued

(6)

Changes in investments in associates and joint ventures accounted for using the equity method for the years ended December 31, 2025 and 2024 are as follows, Continued:

Company. The disposal for the year ended December 31, 2024 includes a portion of shares of SK AMERICAS Inc. (formerly, SK USA Inc.) for ₩167 million, a portion of

Start-up

Win-Win

Fund for ₩200 million, and the entire shares of 12CM JAPAN and Daliworks Inc. for ₩7,296 million and ₩2,013 million, respectively.

(*4)

The Group reclassified the entire shares of F&U Credit information Co., Ltd. as assets held for sale. (See note 39).

(7)

The Group discontinued the application of equity method to the following investees due to their carrying amounts being reduced to zero. The details of cumulative unrecognized equity method losses as of December 31, 2025 are as follows:


(In millions of won)	Unrecognized loss				Unrecognized change in equity
	2025		Cumulative loss		2025			Cumulative loss
Invites Genomics Co., Ltd.	₩	7,662		29,840		(726	)		560
U-land Co., Ltd		—		1,011		—			—

	₩	7,662		30,851		(726	)		560

12.	Property and Equipment

(1)

Property and equipment as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025
	Acquisition cost		Accumulated depreciation			Accumulated impairment loss			Carrying amount
Land	₩	1,319,260		—			—			1,319,260
Buildings		2,041,946		(1,148,764	)		(450	)		892,732
Structures		965,034		(777,607	)		(1,601	)		185,826
Machinery		38,731,865		(31,385,515	)		(11,807	)		7,334,543
Other		1,466,321		(1,181,476	)		(561	)		284,284
Right-of-use assets		2,559,944		(1,187,419	)		—			1,372,525
Construction in progress		513,267		—			(264	)		513,003

	₩	47,597,637		(35,680,781	)		(14,683	)		11,902,173

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

12.	Property and Equipment, Continued

(1)

Property and equipment as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)
	December 31, 2024
	Acquisition cost		Accumulated depreciation			Accumulated impairment loss			Carrying amount
Land	₩	1,260,712		—			—			1,260,712
Buildings		1,822,695		(1,056,427	)		(450	)		765,818
Structures		955,360		(742,772	)		(1,601	)		210,987
Machinery		38,191,687		(30,457,696	)		(11,425	)		7,722,566
Other		1,631,503		(1,262,496	)		—			369,007
Right-of-use assets		2,645,207		(1,036,988	)		—			1,608,219
Construction in progress		681,010		—			(925	)		680,085

	₩	47,188,174		(34,556,379	)		(14,401	)		12,617,394

(2)

Changes in property and equipment for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025
	Beginning balance		Acquisition		Disposal			Transfer(*1)			Depreciation			Impairment			Other Changes(*2)		Ending balance
Land	₩	1,260,712		149		(32,812	)		49,637			—			—			41,574		1,319,260
Buildings		765,818		1,953		(45,157	)		79,349			(59,453	)		—			150,222		892,732
Structures		210,987		1,350		(5	)		8,387			(34,893	)		—			—		185,826
Machinery		7,722,566		530,431		(9,753	)		1,241,385			(2,198,208	)		(381	)		48,503		7,334,543
Other		369,007		180,380		(5,379	)		(189,482	)		(69,685	)		(561	)		4		284,284
Right-of-use assets		1,608,219		278,554		(90,198	)		(3,000	)		(421,050	)		—			—		1,372,525
Construction in progress		680,085		1,298,248		(4,308	)		(1,460,758	)		—			(264	)		—		513,003

	₩	12,617,394		2,291,065		(187,612	)		(274,482	)		(2,783,289	)		(1,206	)		240,303		11,902,173

(*1)

The Group decided to dispose of its shareholdings in SK stoa Co., Ltd. and Media S Co., Ltd., both consolidated subsidiaries. Accordingly, property and equipment of these entities amounting to ₩13,512 million were reclassified as assets held for sale. (See note 39)

(*2)

Other changes consist of increases in assets arising from business combinations under common control. (See note 40)

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

12.	Property and Equipment, Continued

(2)

Changes in property and equipment for the years ended December 31, 2025 and 2024 are as follows, Continued:



(In millions of won)
	2024
	Beginning balance		Acquisition		Disposal			Transfer(*)			Depreciation			Impairment			Changes in consolidation scope			Ending balance
Land	₩	1,248,200		101		(2,213	)		14,624			—			—			—			1,260,712
Buildings		773,392		3,785		(1,279	)		46,479			(56,559	)		—			—			765,818
Structures		234,879		1,574		(78	)		13,408			(37,997	)		—			(799	)		210,987
Machinery		7,890,654		517,884		(23,253	)		1,616,265			(2,267,720	)		(11,025	)		(239	)		7,722,566
Other		485,157		390,130		(12,131	)		(408,675	)		(84,179	)		(10	)		(1,285	)		369,007
Right-of-use assets		1,611,951		523,494		(90,734	)		(26,271	)		(407,338	)		(33	)		(2,850	)		1,608,219
Construction in progress		761,963		1,441,907		(5,030	)		(1,517,830	)		—			(925	)		—			680,085

	₩	13,006,196		2,878,875		(134,718	)		(262,000	)		(2,853,793	)		(11,993	)		(5,173	)		12,617,394

(*)

The Group decided to dispose of the shares of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd., the consolidated subsidiaries, and reclassified the property and equipment amounting to ₩17,412 million of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd. as assets held for sale. (See note 39)

13.	Investment Property

(1)

Investment property as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025							December 31, 2024
	Acquisition cost		Accumulated depreciation			Carrying amount		Acquisition cost		Accumulated depreciation			Carrying amount
Land	₩	18,743		—			18,743		9,787		—			9,787
Buildings		36,741		(21,276	)		15,465		23,010		(14,981	)		8,029
Right-of-use assets		13,808		(8,175	)		5,633		16,518		(7,723	)		8,795

	₩	69,292		(29,451	)		39,841		49,315		(22,704	)		26,611

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

13.	Investment Property, Continued

(2)

Changes in investment property for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025
	Beginning balance		Transfer			Depreciation			Ending balance
Land	₩	9,787		8,956			—			18,743
Buildings		8,029		8,708			(1,272	)		15,465
Right-of-use assets		8,795		(735	)		(2,427	)		5,633

	₩	26,611		16,929			(3,699	)		39,841


(In millions of won)
	2024
	Beginning balance		Transfer(*)			Depreciation			Ending balance
Land	₩	14,199		(4,412	)		—			9,787
Buildings		10,242		(1,143	)		(1,070	)		8,029
Right-of-use assets		10,371		73			(1,649	)		8,795

	₩	34,812		(5,482	)		(2,719	)		26,611

(*)

The Group decided to dispose of the shares of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd., the consolidated subsidiaries, and reclassified the investment property amounting to ₩1,719 million of SK m&service Co., Ltd. as assets held for sale.

(3)

The Group recognized lease income of ₩7,411 million and ₩5,526 million from investment property for the years ended December 31, 2025 and 2024, respectively.

(4)

The fair value of investment property is ₩86,702 million and ₩58,552 million as of December 31, 2025 and 2024, respectively.

14.

Leases

(1)

Group as a lessee

Details of the

right-of-use

assets as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Right-of-use assets:
Land, buildings and structures	₩	1,157,029		1,379,422
Others		215,496		228,797

	₩	1,372,525		1,608,219

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

14.	Leases, Continued

Details of amounts recognized in the consolidated statements of income for the years ended December 31, 2025, 2024 and 2023 as a lessee are as follows:


(In millions of won)
	2025		2024		2023
Depreciation of right-of-use assets:
Land, buildings and structures	₩	356,889		343,161		346,931
Others(*)		64,161		64,177		63,101

	₩	421,050		407,338		410,032

Interest expense on lease liabilities	₩	47,596		50,631		46,595

(*)

Others include the amount reclassified as research and development expenses related to the lease contract for research and development facilities.

Expenses related to short-term leases and leases of

low-value

assets that the Group recognized are immaterial.

The total cash outflows for lease payments for the years ended December 31, 2025, 2024 and 2023 amounted to ₩457,331 million, ₩465,119 million and ₩474,410 million, respectively.

(2)

Group as a lessor

1) Finance lease

The Group recognized interest income of ₩2,408 million, ₩2,566 million and ₩800 million on lease receivables for the years ended December 31, 2025, 2024 and 2023, respectively.

The following table sets out a maturity analysis for lease receivables, presenting the undiscounted lease payments to be received subsequent to December 31, 2025.


(In millions of won)
	Amount
Less than 1 year	₩	15,345
1 ~ 2 years		4,592
2 ~ 3 years		2,765
3 ~ 4 years		1,632
4 ~ 5 years		591

Undiscounted lease payments	₩	24,925

Unrealized finance income	₩	930
Net investment in the lease		23,995

Operating lease

The Group recognized lease income of ₩235,261 million, ₩235,519 million and ₩235,988 million for the years ended December 31, 2025, 2024 and 2023, respectively, of which variable lease payments received are ₩1,588 million, ₩2,309 million and ₩2,694 million, respectively.

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

14.	Leases, Continued

Operating lease, Continued

The following table sets out a maturity analysis of lease payments, presenting the undiscounted fixed payments to be received subsequent to December 31, 2025.


(In millions of won)
	Amount
Less than 1 year	₩	136,517
1 ~ 2 years		79,931
2 ~ 3 years		39,731
3 ~ 4 years		109
4 ~ 5 years		109
More than 5 years		255

	₩	256,652

15.

Goodwill

(1)

Goodwill as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Goodwill related to merger of Shinsegi Telecom, Inc.	₩	1,306,236		1,306,236
Goodwill related to acquisition of SK Broadband Co., Ltd.		764,082		764,082
Other goodwill		2,175		2,175

	₩	2,072,493		2,072,493

(2)

Details of the impairment testing of Goodwill as of December 31, 2025 is as follows:

Goodwill is allocated to the following CGUs for the purpose of impairment testing.

•

goodwill related to Shinsegi Telecom, Inc.: Cellular services;

•

goodwill related to SK Broadband Co., Ltd.: Fixed-line telecommunication services; and

•

other goodwill: Others.

The recoverable amount of CGU is determined based on its value in use. Value in use is calculated using the estimated cash flows based on financial forecasts for the next five years and growth rate for subsequent years (“perpetual growth rate”). The key assumptions used in the estimation of value in use include operating revenue, perpetual growth rate and discount rate. Certain assumptions related to Fixed-line telecommunication services involve management’s most subjective and complex judgments and are subject to significant estimation uncertainty.

Management estimated the operating revenue using external sources and the Group’s historical experience, and determined the estimated cash flows considering market growth forecasts.

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

15.	Goodwill, Continued

(2)

Details of the impairment testing of Goodwill as of December 31, 2025 is as follows, Continued:

A perpetual growth rate was applied for the cash flows expected to be incurred after five years and is not expected to exceed the long-term industry growth rate relevant to each CGU.

The discount rate was calculated using the weighted average cost of equity capital and debt and the beta of equity capital was calculated as the average of industry comparables. Cost of debt was calculated using the yield rate of

non-guaranteed

corporate bonds considering the CGU’s credit rating and debt ratio was determined using the average of the debt ratios of industry comparables. The recoverable amount of the CGU was calculated by applying a

post-tax

discount rate to the estimated future

post-tax

cash flows, and the resulting value in use is not significantly different from the value in use calculated using

pre-tax

cash flows and a

pre-tax

discount rate.

The discount rates and perpetual growth rates applied in the value in use calculations for the years ended December 31, 2025 and 2024 are as follows:


	2025
	Discount rate (Pre-tax)			Discount rate (Post-tax)			Perpetual Growth Rate
Goodwill related to merger of Shinsegi Telecom, Inc.		6.5	%		4.8	%		0.0	%
Goodwill related to acquisition of SK Broadband Co., Ltd.		6.3	%		5.0	%		1.0	%


	2024
	Discount rate (Pre-tax)			Discount rate (Post-tax)			Perpetual Growth Rate
Goodwill related to merger of Shinsegi Telecom, Inc.		7.0	%		5.2	%		0.0	%
Goodwill related to acquisition of SK Broadband Co., Ltd.		7.6	%		6.0	%		1.0	%

(3)

Details of the changes in goodwill for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025		2024
Beginning balance	₩	2,072,493		2,075,009
Reclassified as assets held for sale(*)		—		(2,516	)

Ending balance	₩	2,072,493		2,072,493

(*)

The Group decided to dispose of the shares of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd., the consolidated subsidiaries, and reclassified the goodwill amounting to ₩2,516 million of SK m&service Co., Ltd. as assets held for sale.

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

16.	Intangible Assets

(1)

Intangible assets as of December 31, 2025 and 2024 are as follows:


(In millions of won)	December 31, 2025
	Acquisition cost		Accumulated amortization			Accumulated impairment			Carrying amount
Frequency usage rights(*1)	₩	3,564,907		(2,900,421	)		—			664,486
Land usage rights		41,193		(40,944	)		—			249
Industrial rights		57,239		(37,669	)		—			19,570
Development costs		1,914		(1,906	)		—			8
Facility usage rights		162,391		(150,671	)		—			11,720
Customer relations		501,103		(282,009	)		—			219,094
Club memberships(*2)		91,787		—			(14,326	)		77,461
Other(*3)		4,520,167		(3,795,530	)		(6,605	)		718,032

	₩	8,940,701		(7,209,150	)		(20,931	)		1,710,620


(In millions of won)	December 31, 2024
	Acquisition cost		Accumulated amortization			Accumulated impairment			Carrying amount
Frequency usage rights(*1)	₩	3,564,907		(2,429,361	)		—			1,135,546
Land usage rights		54,341		(54,032	)		—			309
Industrial rights		98,265		(33,092	)		(45,000	)		20,173
Development costs		2,960		(2,933	)		—			27
Facility usage rights		161,561		(148,247	)		—			13,314
Customer relations		505,062		(258,943	)		—			246,119
Club memberships(*2)		93,266		—			(14,648	)		78,618
Other(*3)		5,029,153		(4,284,644	)		(43,744	)		700,765

	₩	9,509,515		(7,211,252	)		(103,392	)		2,194,871

(*1)

The Parent Company was reassigned 800 MHz, 1.8 GHz and 2.1 GHz band of frequency licenses from the Ministry of Science and Information and Communication Technology (“ICT”) in exchange for ₩227,200 million, ₩547,800 million and ₩411,700 million, respectively, for the year ended December 31, 2021. The band of frequency was assigned to the Parent Company at the date of initial lump sum payment for the year ended December 31, 2021 and the annual payments in installment for the remaining balances are made in the next five years starting from the date of initial lump sum payment.

(*2)

Club memberships are classified as intangible assets with indefinite useful lives and are not amortized.

(*3)

Other intangible assets primarily consist of computer software and others.

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

16.	Intangible Assets, Continued

(2)

Changes in intangible assets for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025
	Beginning balance		Acquisition		Disposal			Transfer (*2)			Amortization			Impairment (*1)			Other changes(*3)		Ending balance
Frequency usage rights	₩	1,135,546		—		—			—			(471,060	)		—			—		664,486
Land usage rights		309		96		—			—			(156	)		—			—		249
Industrial rights		20,173		3,976		—			—			(4,579	)		—			—		19,570
Development costs		27		—		—			—			(19	)		—			—		8
Facility usage rights		13,314		848		(2	)		381			(2,821	)		—			—		11,720
Customer relations		246,119		—		—			—			(27,025	)		—			—		219,094
Club memberships		78,618		6,580		(3,900	)		(2,542	)		—			(1,295	)		—		77,461
Other		700,765		105,212		(1,861	)		212,122			(297,569	)		(639	)		2		718,032

	₩	2,194,871		116,712		(5,763	)		209,961			(803,229	)		(1,934	)		2		1,710,620

(*1)

The Group recognized the difference between recoverable amount and the carrying amount of intangible assets amounting to ₩1,934 million as impairment loss for the year ended December 31, 2025.

(*2)

The Group decided to dispose of the shares of SK stoa Co., Ltd. and Media S Co., Ltd., the consolidated subsidiaries, and reclassified the intangible assets amounting to ₩17,795 million of SK stoa Co., Ltd. and Media S Co., Ltd., as assets held for sale. (See note 39)

(*3)

Other changes consist of increases in assets arising from business combinations under common control. (See note 40)


(In millions of won)
	2024
	Beginning balance		Acquisition		Disposal			Transfer (*2)			Amortization			Impairment (*1)			Changes in consolidation scope			Ending balance
Frequency usage rights	₩	1,606,606		—		—			—			(471,060	)		—			—			1,135,546
Land usage rights		587		69		(5	)		—			(342	)		—			—			309
Industrial rights		46,154		6,578		(241	)		(1	)		(4,962	)		(27,340	)		(15	)		20,173
Development costs		49		—		—			—			(22	)		—			—			27
Facility usage rights		14,313		1,477		(3	)		618			(3,091	)		—			—			13,314
Customer relations		273,150		—		—			—			(27,031	)		—			—			246,119
Club memberships		97,186		3,700		(20,065	)		(1,727	)		—			(476	)		—			78,618
Other		823,092		61,598		(1,596	)		209,702			(336,870	)		(54,927	)		(234	)		700,765

	₩	2,861,137		73,422		(21,910	)		208,592			(843,378	)		(82,743	)		(249	)		2,194,871

(*1)

The Group recognized the difference between recoverable amount and the carrying amount of intangible assets amounting to ₩82,743 million as impairment loss for the year ended December 31, 2024.

F-6

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

16.	Intangible Assets, Continued

(2)

Changes in intangible assets for the years ended December 31, 2025 and 2024 are as follows, Continued:

(*2)

The Group decided to dispose of the shares of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd., the consolidated subsidiaries, and reclassified the intangible assets amounting to ₩5,655 million of NATE Communications Corporation (formerly, SK Communications Co., Ltd.) and SK m&service Co., Ltd. as assets held for sale. (See note 39)

(3)

Research and development expenditures recognized as expense for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Research and development costs expensed as incurred	₩	339,507		378,079		369,507

(4)

Details of frequency usage rights as of December 31, 2025 are as follows:

(In millions of won)

Amount

Description

Commencement
of amortization

Completion
of amortization

800MHz license

₩

21,958

LTE service

Jul. 2021

Jun. 2026

1.8GHz license

96,968

LTE service

Dec. 2021

Dec. 2026

2.6GHz license

121,410

LTE service

Sep. 2016

Dec. 2026

2.1GHz license

72,876

W-CDMA

and LTE service

Dec. 2021

Dec. 2026

3.5GHz license

351,274

5G service

Apr. 2019

Nov. 2028

₩

664,486

17.	Borrowings and Debentures

(1)

Short-term borrowings as of December 31, 2025 and 2024 are as follows:


(In millions of won)
Lender	Annual interest rate (%)	Maturity	December 31, 2025		December 31, 2024
SK Securities Co., Ltd.	3.62	Oct. 2, 2025	₩	—		50,000
Shinhan Securities Co., Ltd.	3.62	Oct. 2, 2025		—		50,000
Bank of China Ltd.	2.83	Oct. 29, 2026		130,000		—

			₩	130,000		100,000

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

17.	Borrowings and Debentures, Continued

(2)

Long-term borrowings as of December 31, 2025 and 2024 are as follows:


(In millions of won)
Lender	Annual interest rate (%)		Maturity		December 31, 2025			December 31, 2024
Korea Development Bank(*1)		1.87		Feb. 10, 2026	₩	3,125			15,625
DBS Bank Ltd.		2.63		Mar. 10, 2025		—			200,000
Credit Agricole CIB		4.89		Nov. 28, 2025		—			50,000
Mizuho Bank, Ltd.(*2)		3M CD + 1.05		Jul. 25, 2025		—			50,000
DBS Bank Ltd.(*2)		3M CD + 0.075		Oct. 8, 2026		200,000			200,000
Industrial and Commercial Bank of China Ltd.		2.70		Sep. 13, 2027		100,000			—
Mizuho Bank, Ltd.		2.75		Sep. 22, 2027		200,000			—

						503,125			515,625
Less: present value discount						—			(25	)

						503,125			515,600
Less: current portions						(203,125	)		(312,475	)

					₩	300,000			203,125

(*1)

The long-term borrowings are to be repaid by installments on an annual basis from 2022 to 2026.

(*2)

Applied interest rate is the 3M CD rate of 2.85% and 3.41% as of December 31, 2025 and 2024, respectively.

(3)

Debentures as of December 31, 2025 and 2024 are as follows:


(In millions of won and thousands of U.S. dollars)
	Purpose	Maturity		Annual interest rate (%)		December 31, 2025		December 31, 2024
Unsecured corporate bonds	Operating fund		2032		3.45	₩	90,000		90,000
Unsecured corporate bonds			2033		3.22		130,000		130,000
Unsecured corporate bonds	Operating and refinancing fund		2025		2.49		—		150,000
Unsecured corporate bonds	Operating fund		2030		2.61		50,000		50,000
Unsecured corporate bonds			2025		2.66		—		70,000
Unsecured corporate bonds			2030		2.82		90,000		90,000
Unsecured corporate bonds	Refinancing fund		2025		2.55		—		100,000
Unsecured corporate bonds			2035		2.75		70,000		70,000
Unsecured corporate bonds	Operating fund		2026		2.08		90,000		90,000
Unsecured corporate bonds			2036		2.24		80,000		80,000
Unsecured corporate bonds			2026		1.97		120,000		120,000
Unsecured corporate bonds			2031		2.17		50,000		50,000
Unsecured corporate bonds	Refinancing fund		2027		2.55		100,000		100,000
Unsecured corporate bonds	Operating and refinancing fund		2032		2.65		90,000		90,000
Unsecured corporate bonds	Refinancing fund		2027		2.84		100,000		100,000
Unsecured corporate bonds	Operating fund		2028		3.00		200,000		200,000
Unsecured corporate bonds			2038		3.02		90,000		90,000

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

17.	Borrowings and Debentures, Continued

(3)

Debentures as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won and thousands of U.S. dollars)
	Purpose	Maturity		Annual interest rate (%)		December 31, 2025		December 31, 2024
Unsecured corporate bonds			2038		2.44		50,000		50,000
Unsecured corporate bonds			2029		2.19		50,000		50,000
Unsecured corporate bonds			2039		2.23		50,000		50,000
Unsecured corporate bonds	Operating and refinancing fund		2029		1.50		120,000		120,000
Unsecured corporate bonds	Refinancing fund		2039		1.52		50,000		50,000
Unsecured corporate bonds			2049		1.56		50,000		50,000
Unsecured corporate bonds	Operating fund		2029		1.79		40,000		40,000
Unsecured corporate bonds			2039		1.81		60,000		60,000
Unsecured corporate bonds			2025		1.75		—		130,000
Unsecured corporate bonds			2030		1.83		50,000		50,000
Unsecured corporate bonds			2040		1.87		70,000		70,000
Unsecured corporate bonds	Refinancing fund		2025		1.40		—		140,000
Unsecured corporate bonds			2030		1.59		40,000		40,000
Unsecured corporate bonds			2040		1.76		110,000		110,000
Unsecured corporate bonds			2026		1.39		80,000		80,000
Unsecured corporate bonds			2031		1.80		50,000		50,000
Unsecured corporate bonds			2041		1.89		100,000		100,000
Unsecured corporate bonds			2026		2.69		70,000		70,000
Unsecured corporate bonds			2041		2.68		40,000		40,000
Unsecured corporate bonds			2025		3.80		—		240,000
Unsecured corporate bonds			2027		3.84		70,000		70,000
Unsecured corporate bonds			2042		3.78		40,000		40,000
Unsecured corporate bonds			2025		4.00		—		300,000
Unsecured corporate bonds			2027		4.00		95,000		95,000
Unsecured corporate bonds			2025		4.73		—		110,000
Unsecured corporate bonds			2027		4.74		60,000		60,000
Unsecured corporate bonds			2032		4.69		40,000		40,000
Unsecured corporate bonds			2026		3.65		110,000		110,000
Unsecured corporate bonds			2028		3.83		190,000		190,000
Unsecured corporate bonds			2026		3.72		80,000		80,000
Unsecured corporate bonds			2028		3.80		200,000		200,000
Unsecured corporate bonds			2030		3.96		70,000		70,000
Unsecured corporate bonds			2026		4.54		115,000		115,000
Unsecured corporate bonds			2028		4.68		100,000		100,000
Unsecured corporate bonds			2030		4.72		50,000		50,000
Unsecured corporate bonds			2033		4.72		30,000		30,000
Unsecured corporate bonds			2027		3.72		180,000		180,000
Unsecured corporate bonds			2029		3.73		110,000		110,000
Unsecured corporate bonds			2034		3.92		110,000		110,000
Unsecured corporate bonds			2027		2.91		170,000		170,000
Unsecured corporate bonds			2029		2.92		90,000		90,000
Unsecured corporate bonds			2034		2.96		40,000		40,000
Unsecured corporate bonds			2028		2.98		190,000		—

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

17.	Borrowings and Debentures, Continued

(3)

Debentures as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won and thousands of U.S. dollars)
	Purpose	Maturity		Annual interest rate (%)		December 31, 2025			December 31, 2024
Unsecured corporate bonds			2030		3.05		70,000			—
Unsecured corporate bonds			2035		3.17		140,000			—
Unsecured corporate bonds			2028		2.67		80,000			—
Unsecured corporate bonds			2030		2.82		190,000			—
Unsecured corporate bonds			2035		3.06		40,000			—
Unsecured corporate bonds(*1)	Operating and refinancing fund		2026		1.86		50,000			50,000
Unsecured corporate bonds(*1)			2025		1.64		—			100,000
Unsecured corporate bonds(*1)	Refinancing fund		2025		1.41		—			160,000
Unsecured corporate bonds(*1)			2025		2.58		—			100,000
Unsecured corporate bonds(*1)			2032		2.92		50,000			50,000
Unsecured corporate bonds(*1)	Operating and refinancing fund		2025		4.21		—			50,000
Unsecured corporate bonds(*1)			2026		4.28		100,000			100,000
Unsecured corporate bonds(*1)			2028		4.37		90,000			90,000
Unsecured corporate bonds(*1)	Facility fund		2026		4.87		100,000			100,000
Unsecured corporate bonds(*1)			2028		5.00		60,000			60,000
Unsecured corporate bonds(*1)	Refinancing fund		2027		3.89		170,000			170,000
Unsecured corporate bonds(*1)			2029		3.93		60,000			60,000
Unsecured corporate bonds(*1)	Facility and Refinancing fund		2027		3.06		130,000			130,000
Unsecured corporate bonds(*1)			2029		3.06		115,000			115,000
Unsecured corporate bonds(*1)			2031		3.11		50,000			50,000
Unsecured corporate bonds(*1)	Refinancing fund		2028		2.76		50,000			—
Unsecured corporate bonds(*1)			2030		2.87		120,000			—
Unsecured corporate bonds(*1)			2035		2.97		30,000			—
Unsecured corporate bonds(*1)	Business acquisition fund		2030		3.09		480,000			—
Unsecured corporate bonds(*1)			2035		3.38		50,000			—
Registered unsecured private exchangeable bond(*2)	Refinancing fund		2027		—		7,008			—
Unsecured global bonds	Operating fund		2027		6.63		573,960 (USD 400,000	)		588,000 (USD 400,000	)
Unsecured global bonds(*1)	Refinancing fund		2028		4.88		430,470 (USD 300,000	)		441,000 (USD 300,000	)
Floating rate notes(*3)	Operating fund		2025		SOFR rate + 1.17		—			441,000 (USD 300,000	)
			2028		SOFR rate + 0.59		430,470 (USD 300,000	)		—
Convertible bonds(*4)			2028		—		—			4,410 (USD 3,000	)
Convertible bonds(*4)			2028		—		—			23,741 (USD 16,150	)

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

17.	Borrowings and Debentures, Continued

(3)

Debentures as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won and thousands of U.S. dollars)
	Purpose	Maturity		Annual interest rate (%)		December 31, 2025			December 31, 2024
Convertible bonds(*4)			2028		—		—			11,392 (USD 7,750	)
Convertible bonds(*4)			2028		—		—			11,760 (USD 8,000	)

							8,236,908			8,526,303
Less: discounts on bond							(23,004	)		(15,023	)

							8,213,904			8,511,280
Less: current portions of bonds							(919,459	)		(2,147,634	)

						₩	7,294,445			6,363,646

(*1)

Unsecured corporate bonds were issued by SK Broadband Co., Ltd., a subsidiary of the Parent Company.

(*2)

Exchangeable bonds were issued by SAPEON Inc., a subsidiary of the Parent Company.

(*3)

Applied interest rates are SOFR rate of 4.20% and 4.49% as of December 31, 2025 and 2024, respectively.

(*4)

Convertible bonds were issued by SAPEON Inc., a subsidiary of the Parent Company, and redeemed on February 7, 2025, pursuant to an early redemption request.

18.	Long-term Payables – other

(1)

As of December 31, 2025 and 2024, details of long-term payables – other which consist of payables related to the acquisition of frequency usage rights are as follows (See note 16):


(In millions of won)
	December 31, 2025			December 31, 2024
Long-term payables – other	₩	551,925			921,075
Present value discount on long-term payables – other		(3,964	)		(13,355	)
Current portion of long-term payables – other		(368,572	)		(367,765	)

Carrying amount as of December 31	₩	179,389			539,955

(2)

Repayments of the principal portion of long-term payables – other amounted to ₩369,150 million for each of the years ended December 31, 2025 and 2024, respectively. The repayment schedule for the principal amount of long-term payables – other as of December 31, 2025 is as follows:


(In millions of won)
	Amount
Less than 1 year	₩	369,150
1 ~ 3 years		182,775

	₩	551,925

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

19.	Provisions

Changes in provisions for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025															As of December 31, 2025
	Beginning balance		Increase		Utilization			Reversal			Other(*)			Ending balance		Current		Non-current
Provision for restoration	₩	119,623		5,837		(6,330	)		(1,272	)		(275	)		117,583		37,502		80,081
Emission allowance		437		1,641		(266	)		(1,282	)		—			530		530		—
Other provisions (note 28)		—		108,039		(105	)		—			—			107,934		107,921		13

	₩	120,060		115,517		(6,701	)		(2,554	)		(275	)		226,047		145,953		80,094

(*)

Other includes amounts reclassified as liabilities held for sale for the year ended December 31, 2025.


(In millions of won)
	2024																		As of December 31, 2024
	Beginning balance		Increase		Utilization			Reversal			Changes in consolidation scope			Other(*)			Ending balance		Current		Non-current
Provision for restoration	₩	120,024		6,475		(3,555	)		(1,053	)		(351	)		(1,917	)		119,623		49,579		70,044
Emission allowance		1,182		1,410		(130	)		(2,025	)		—			—			437		437		—
Other provisions		218		—		—			(218	)		—			—			—		—		—

	₩	121,424		7,885		(3,685	)		(3,296	)		(351	)		(1,917	)		120,060		50,016		70,044

(*)

Other includes amounts reclassified as liabilities held for sale for the year ended December 31, 2024.

20.	Defined Benefit Liabilities (Assets)

(1)

Details of defined benefit liabilities (assets) as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025			December 31, 2024
Present value of defined benefit obligations	₩	1,051,508			1,142,324
Fair value of plan assets		(1,256,985	)		(1,294,567	)

Defined benefit assets(*)		(205,477	)		(154,329	)

Defined benefit liabilities		—			2,086

(*)

Since the Group entities neither have legally enforceable right nor intention to settle the defined benefit obligations of Group entities with defined benefit assets of other Group entities, defined benefit assets of Group entities have been separately presented from defined benefit liabilities.

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

20.	Defined Benefit Liabilities (Assets), Continued

(2)

Principal actuarial assumptions as of December 31, 2025 and 2024 are as follows:


	December 31, 2025		December 31, 2024
Discount rate for defined benefit obligations		3.51% ~ 4.57%		3.35% ~ 4.24%
Expected rate of salary increase		2.00% ~ 6.22%		2.00% ~ 5.42%

Discount rate for defined benefit obligation is determined based on market yields of high-quality corporate bonds with similar maturities for estimated payment term of defined benefit obligation. Expected rate of salary increase is determined based on the Group’s historical promotion index, inflation rate and salary increase ratio.

(3)

Changes in present value of defined benefit obligations for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024
Beginning balance	₩	1,142,324			1,121,679
Current service cost		123,241			130,538
Interest cost		42,399			47,463
Remeasurement - Demographic assumption		264			(761	)
- Financial assumption		(14,087	)		49,788
- Adjustment based on experience		26,041			(15,085	)
Benefit paid(*1)		(270,415	)		(157,801	)
Past service cost		1,693			6,795
Changes in consolidation scope		—			(2,458	)
Others(*2)		48			(37,834	)

Ending balance	₩	1,051,508			1,142,324

(*1)

Benefit paid includes payments arising from changes to the retirement benefit plan for the years ended December 31, 2025 and 2024.

(*2)

Others include changes in liabilities due to employees’ transfers among affiliates and reclassification as liabilities held for sale for the years ended December 31, 2025 and 2024.

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

20.	Defined Benefit Liabilities (Assets), Continued

(4)

Changes in fair value of plan assets for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024
Beginning balance	₩	1,294,567			1,292,416
Interest income		46,765			54,215
Remeasurement		1,406			729
Contributions		182,076			124,921
Benefit paid(*1)		(264,521	)		(131,031	)
Changes in consolidation scope		—			(2,151	)
Others(*2)		(3,308	)		(44,532	)

Ending balance	₩	1,256,985			1,294,567

(*1)

Benefit paid includes payments arising from changes to the retirement benefit plan for the years ended December 31, 2025 and 2024.

(*2)

Others include changes in assets due to employees’ transfers among affiliates and reclassification as assets held for sale for the years ended December 31, 2025 and 2024.

The Group’s expected contributions to the defined benefit plan for the year ended December 31, 2026, amounts to ₩167,383 million.

(5)

Total cost of defined benefit plan, which is recognized in profit or loss for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024
Current service cost	₩	123,241			130,538
Net interest income		(4,366	)		(6,752	)
Past service cost		1,693			6,795

	₩	120,568			130,581

Costs related to the defined benefit plan except for the amounts transferred to construction in progress are included in labor expenses and research and development expenses.

(6)

Details of plan assets as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Equity instruments	₩	102,046		67,184
Debt instruments		238,979		394,138
Short-term financial instruments, etc.		915,960		833,245

	₩	1,256,985		1,294,567

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

20.	Defined Benefit Liabilities (Assets), Continued

(7)

Sensitivity analysis

As of December 31, 2025, reasonably possible changes to each of the significant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below:


(In millions of won)
	0.5%p Increase			0.5%p Decrease
Discount rate	₩	(37,121	)		39,709
Expected salary increase rate		39,780			(37,537	)

A sensitivity analysis does not consider dispersion of all cash flows that are expected from the plan but provides approximate values of sensitivity for the assumptions used.

The weighted average duration of defined benefit obligations as of December 31, 2025 and 2024

7.33 years and 7.46 years, respectively.

(8)

Defined contribution plan

The amount recognized as an expense for defined contribution plans are ₩35,454 million and ₩29,784 million for the years ended December 31, 2025 and 2024, respectively.

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

21.	Derivative Instruments

(1)

Currency and interest rate swap contracts under cash flow hedge accounting as of December 31, 2025 are as follows:


(In millions of won, thousands of U.S. dollars)
Borrowing date	Hedging Instrument (Hedged item)	Hedged risk	Financial institution	Duration of contract
Jul. 20, 2007	Fixed-to-fixed cross currency swap (U.S. dollar denominated bonds face value of USD 400,000)	Foreign currency risk	Morgan Stanley and four other banks	Jul. 20, 2007 ~ Jul. 20, 2027
Jun. 28, 2023	Fixed-to-fixed cross currency swap (U.S. dollar denominated bonds face value of USD 300,000)	Foreign currency risk	Citi bank, Shinhan Bank, Korea Development Bank and J.P. Morgan	Jun. 28, 2023 ~ Jun. 28, 2028
Oct. 7, 2024	Floating-to-fixed interest rate swap (Korean won borrowing amounting to KRW 200,000)	Interest rate risk	DBS Bank Ltd.	Oct. 10, 2024 ~ Oct. 8, 2026
May. 28, 2025	Floating-to-fixed cross currency interest rate swap (U.S. dollar denominated bonds face value of USD 300,000)	Foreign currency risk and interest rate risk	DBS Bank Ltd.	May. 28, 2025 ~ May. 26, 2028

(2)

SK Broadband Co., Ltd., a subsidiary of the Parent Company, entered into Total Return Swap (“TRS”) contracts with IGIS Professional Investment Type Private Real Estate Investment Trust No. 156 and Hana Professional Alternative Investment Type Private Real Estate Investment Trust No. 62, with underlying beneficiary certificates of ₩270,000 million and ₩80,000 million, respectively. Under the terms of the contracts, the parties settle the difference arising from changes in the value of the real estate at maturity, as well as the difference between the actual dividends received and the contractual base dividend during the contract period. SK Broadband Co., Ltd. is obligated to guarantee a fixed rate of return to the counterparties to each contract. As of December 31, 2025 and 2024, SK Broadband Co., Ltd. recognized derivative financial assets of ₩91,824 million and ₩64,926 million, respectively, in relation to the TRS contracts. The derivative financial assets were measured using a discounted cash flow method based on estimated future cash flows.

(3)

SAPEON Inc., a subsidiary of the Parent Company, disposed of a portion of its shares in Rebellions Inc. (formerly, SAPEON Korea Inc.) during the year ended December 31, 2024, and, concurrently, the Parent Company entered into a Price Return Swap (“PRS”) under which the buyer is entitled to receive the difference between the sale proceeds and the settlement amount upon the subsequent sale of the shares. The Parent Company recognized a derivative financial liability of ₩555 million in relation to the PRS as of December 31, 2025.

(4)

PS&Marketing Corporation, a subsidiary of the Parent Company, entered into a Total Return Swap (“TRS”) contract with Kukje Lucestar Investment Private Equity Real Estate Investment Trust No.2 with underlying beneficiary certificates amounting to ₩50,000 million. Under the terms of the contract, the parties settle the difference arising from changes in the value of the underlying real estate at maturity, as well as the difference between actual dividends and the contractual base dividend during the contract period. PS&Marketing Corporation is obligated to guarantee a fixed rate of return to the counter party. As of December 31, 2025 and 2024, PS&Marketing Corporation recognized derivative financial assets of ₩5,830 million and ₩5,385 million, respectively, in relation to the TRS. The derivative financial assets were measured using a discounted cashflow approach based on estimated future cash flows.

F-7

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

21.	Derivative Instruments, Continued

(5)

PS&Marketing Corporation, a subsidiary of the Parent Company, disposed of 2,169,379 common shares (ownership interest: 70%) of SK m&service Co., Ltd. to SAMKOO Inc. during the year ended December 31, 2025, and entered into a shareholders’ agreement in connection with the transaction. Pursuant to the shareholders’ agreement, PS&Marketing Corporation holds a put option that entitles it to sell all or part of its remaining shares to the counterparty in accordance with the specified procedures and conditions for a period of eight years beginning three years after the closing date of the transaction. PS&Marketing Corporation recognized a derivative financial asset of ₩11,230 million as of December 31, 2025 in relation to the put option.

(6)

The derivative financial instruments to which the Group applies cash flow hedging is recorded in the consolidated financial statements as derivative financial assets and derivative financial liabilities. As of December 31, 2025, details of fair values of the derivative assets and liabilities are as follows:


(In millions of won, thousands of U.S. dollars)
Hedging instrument (Hedged item)	Cash flow hedge			Fair value
Assets:
Fixed-to-fixed cross currency (U.S. dollar denominated bonds face value of USD 400,000)	₩	137,222			137,222
Fixed-to-fixed cross currency swap (U.S. dollar denominated bonds face value of USD 300,000)		45,006			45,006
Floating-to-fixed cross currency interest rate swap (U.S. dollar denominated bonds face value of USD 300,000)		19,034			19,034

	₩	201,262			201,262

Liabilities:
Floating-to-fixed interest rate swap (Korean won borrowing amounting to KRW 200,000)	₩	(621	)		(621	)

	₩	(621	)		(621	)

As of December 31, 2025, changes in fair value of derivatives designated as hedging instruments, all of which were assessed as effective hedges, were recognized in full in other comprehensive income.

(7)

The derivatives held for trading is recorded in the consolidated financial statements as derivative financial assets and derivative financial liabilities. As of December 31, 2025, details of fair values of the derivative assets and liabilities are as follows:


(In millions of won)
	Held for trading			Fair value
Assets:
Total Return Swap (“TRS”)	₩	97,654			97,654
Share option		11,230			11,230

	₩	108,884			108,884

Liabilities:
Foreign exchange forward contract	₩	(26	)		(26	)
Price Return Swap (“PRS”)		(555	)		(555	)
Share option		(1,769	)		(1,769	)
Exchange option		(3,432	)		(3,432	)

	₩	(5,782	)		(5,782	)

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

22.	Share Capital and Capital Surplus and Others

(1)

Details of share capital as of December 31, 2025 and 2024 are as follows:


(In millions of won, except for share data)
	December 31, 2025		December 31, 2024
Number of authorized shares		670,000,000		670,000,000
Par value (in won)	₩	100		100
Number of issued shares		214,790,053		214,790,053
Share capital:
Common shares(*)	₩	30,493		30,493

(*)

In 2002, 2003 and 2024, the Parent Company retired treasury shares with reduction of its retained earnings before appropriation. As a result, the Group’s issued shares have decreased without change in share capital.

(2)

Changes in issued shares for the years ended December 31, 2025 and 2024 are as follows:


(In shares)
	2025		2024
Issued shares as of January 1		214,790,053		218,833,144
Retirement of treasury shares(*)		—		(4,043,091	)

Issued shares as of December 31		214,790,053		214,790,053

(*)

The Parent Company retired 4,043,091 treasury shares with reduction of its retained earnings before appropriation for the year ended December 31, 2024.

(3)

Details of shares outstanding as of December 31, 2025 and 2024 are as follows:

(In shares)

December 31, 2025

December 31, 2024

Issued

Treasury
shares

Outstanding
shares

Issued

Treasury
shares

Outstanding
shares

Shares outstanding

214,790,053

1,807,778

212,982,275

214,790,053

1,903,711

212,886,342

(4)

Details of capital surplus and others as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025			December 31, 2024
Paid-in surplus	₩	1,771,000			1,771,000
Treasury shares (Note 23)		(88,533	)		(92,962	)
Hybrid bonds (Note 24)		398,509			398,509
Share option (Note 25)		14,511			14,498
Others(*)		(14,226,827	)		(14,045,981	)

	₩	(12,131,340	)		(11,954,936	)

(*)

The amount includes a change in equity amounting to ₩13,340,037 million due to the

spin-off

that was accounted for as a transaction under common control.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

23.	Treasury Shares

(1)

Treasury shares as of December 31, 2025 and 2024 are as follows:


(In millions of won, except for the number of shares)
	December 31, 2025		December 31, 2024
Number of shares		1,807,778		1,903,711
Acquisition cost	₩	88,533		92,962

(2)

Changes in treasury shares for the years ended December 31, 2025 and 2024 are as follows:


(In shares)
	2025			2024
Treasury shares as of January 1		1,903,711			6,133,414
Acquisition(*1)		—			317,000
Disposal(*2)		(95,933	)		(503,612	)
Retirement of treasury shares(*3)		—			(4,043,091	)

Treasury shares as of December 31		1,807,778			1,903,711

(*1)

The Parent Company acquired 317,000 treasury shares for ₩15,788 million in an effort to increase shareholder value by stabilizing its stock price for the year ended December 31, 2024.

(*2)

The Parent Company granted 91,073 treasury shares (acquisition cost: ₩4,191 million) upon exercise of stock options for the year ended December 31, 2025, resulting in a gain on disposal of treasury shares of ₩1,164 million, and the Parent Company distributed 4,860 treasury shares (acquisition cost: ₩238 million) as bonus payment to the employees, resulting in gain on disposal of treasury shares of ₩24 million for the year ended December 31, 2025. Also, the Parent Company distributed 503,612 treasury shares (acquisition cost: ₩24,807 million) as bonus payment to the employees, resulting in gain on disposal of treasury shares of ₩181 million for the year ended December 31, 2024.

(*3)

The Parent Company retired 4,043,091 treasury shares with reduction of its retained earnings before appropriation, as a result, the Parent Company’s issued shares have decreased without change in share capital for the year ended December 31, 2024.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

24.	Hybrid Bonds

Hybrid bonds classified as equity as of December 31, 2025 and 2024 are as follows:

(In millions of won)

Type

Issuance
date

Maturity(*1)

Annual
interest
rate(%)(*2)

December 31,
2025

December 31,
2024

Series 3 hybrid bonds

Unsecured subordinated

bearer bond

June 5,
2023

June 5,
2083

4.95

₩

400,000

Issuance costs

(1,491

)

(1,491

)

₩

398,509

As the Parent Company has no contractual obligation to deliver cash or other financial assets to the holders of its hybrid bonds, the instruments are classified as equity. In the event of liquidation or bankruptcy, the hybrid bonds rank senior only to common shares.

(*1)

The Parent Company has the right to extend the maturity at its discretion without providing any prior notice or announcement.

(*2)

The annual interest rate is determined as yield rate of a

5-year

national bond plus a premium. According to the

step-up

clause, an additional premium of 0.25% and 0.75% is applied after 10 years and 25 years, respectively, from the issuance date.

25.	Share-based payment Arrangement

25.1

Share-based payment arrangement of the Parent Company

(1)

Terms and conditions related to the grants of the share-based payment arrangement are as follows:

Share-based payment arrangement with cash alternatives


	Series
	5(*)	6	7-1	7-2
Grant date	March 26, 2020	March 25, 2021	March 25, 2022
Types of shares to be issued	Registered common shares of the Parent Company
Grant method	Reissue of treasury shares, Cash settlement
Number of shares (in share)	32,947	71,726	98,425	96,820
Exercise price (in won)	38,452	50,276	56,860	56,860
Exercise period	Mar. 27, 2023 ~ Mar. 26, 2027	Mar. 26, 2023 ~ Mar. 25, 2026	Mar. 26, 2025 ~ Mar. 25, 2029	Mar. 26, 2024 ~ Mar. 25, 2027
Vesting conditions	3 years’ service from the grant date	2 years’ service from the grant date	2 years’ service from the grant date	2 years’ service from the grant date

(*)

For the year ended December 31, 2025, some portions of stock options granted in the 5

series were exercised.

Cash-settled share-based payment arrangement

The entire amount of remaining share appreciation rights for shares of SK Telecom Co., Ltd. granted in 2022 was not exercised and was fully forfeited during the year ended December 31, 2025.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

25.	Share-based payment Arrangement, Continued

25.1

Share-based payment arrangement of the Parent Company, Continued

(1)

Terms and conditions related to the grants of the share-based payment arrangement are as follows, Continued:

Equity-settled share-based payment arrangement

The Parent Company established Performance Share Units (”PSU”) for executives of the Parent Company and major subsidiaries as part of the compensation based on the growth of corporate value during the year ended December 31, 2023, and the details are as follows:


	PSU of SK Telecom Co., Ltd.
Grant date	March 28, 2023	March 26, 2024
Types of shares to be issued	Registered common shares of the Parent Company
Grant method	Reissue of treasury shares
Number of shares(*)	Fluctuates according to the share price on the expiration date and the cumulative increase rate of KOSPI200
Reference share price (in won)	47,280	52,720
Reference index (KOSPI200)	315	362
Maturity (exercise date)	The day in which the annual general meeting of shareholders is held after 3 years from the grant date
Vesting conditions	Full service in the year in which the grant date is included

(*)

The initial grant amounted to ₩10,813 million in 2023 and ₩12,835 million in 2024. The number of shares to be delivered is determined based on the adjustment rate calculated using the share price on the expiration date and the cumulative increase rate of KOSPI200.

(2)

Share compensation expense for share-based payment arrangements with cash alternatives recognized for the year ended December 31, 2025 is as follows, and there is no remaining share compensation expense to be recognized in subsequent periods.


(In millions of won)
	Share compensation expense
Cumulative amount through December 31, 2024	₩	158,596
For the year ended December 31, 2025		(439	)

	₩	158,157

The liabilities recognized by the Parent Company in relation to the share-based payment arrangement with cash alternatives are ₩1,134 million and ₩7,283 million, respectively, which are included in accrued expenses as of December 31, 2025 and 2024.

As of December 31, 2024, the carrying amount of liabilities recognized by the Parent Company in relation to the cash-settled share-based payment arrangement are ₩305 million

and no liability was recognized as of December 31, 2025.

Share compensation expenses recognized for the Parent Company’s equity-settled share-based payment arrangements

was

₩6,286 million for the year ended December 31, 2024, and no expense was recognized for the year ended December 31, 2025.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

25.	Share-based payment Arrangement, Continued

25.1

Share-based payment arrangement of the Parent Company, Continued

(3)

The Parent Company used option-pricing models, including the binomial model, on the measurement of the fair value of the share options and the inputs used in the model are as follows:

Share-based payment arrangement with cash alternatives

(i) SK Telecom Co., Ltd.


(In won)	Series
	5			6			7-1			7-2
Risk-free interest rate		2.65	%		2.43	%		3.02	%		2.64	%
Estimated option’s life		7 years			5 years			7 years			5 years
Share price on the remeasurement date		53,500			53,500			53,500			53,500
Expected volatility		15.30	%		15.30	%		15.30	%		15.30	%
Expected dividends yield		6.62	%		6.62	%		6.62	%		6.62	%
Exercise price		38,452			50,276			56,860			56,860
Per-share fair value of the option		15,048			3,394			2,520			1,518

(ii) SK Square Co., Ltd.


(In won)	Series
	5			6
Risk-free interest rate		1.52	%		1.55	%
Estimated option’s life		7 years			5 years
Share price (Closing price on the preceding day)		34,900			49,800
Expected volatility		8.10	%		25.70	%
Expected dividends yield		5.70	%		4.00	%
Exercise price		38,452			50,276
Per-share fair value of the option		192			8,142

Equity-settled share-based payment arrangement


(In won)	Granted in 2023			Granted in 2024
	PSU of SK Telecom Co., Ltd.			PSU of SK Telecom Co., Ltd.
Risk-free interest rate		3.26	%		3.30	%
Estimated option’s life		3 years			3 years
Share price on the grant date		48,500			54,100
Expected volatility		18.67	%		15.90	%
Expected dividends yield		4.90	%		5.40	%
Per-share fair value of the option		27,525			25,920

25.2

Share-based payment arrangement by SAPEON Inc., a subsidiary of the Parent Company

The entire amount of remaining share-based payment arrangement granted by SAPEON Inc. to its employees was not exercised and was fully forfeited during the year ended December 31, 2025.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

26.	Retained Earnings

(1)

Retained earnings as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Appropriated:
Legal reserve	₩	22,320		22,320
Reserve for business expansion		10,131,138		9,981,138
Reserve for technology development		4,865,300		4,715,300

		14,996,438		14,696,438
Unappropriated		7,919,510		8,257,369

	₩	22,938,268		22,976,127

(2)

Legal reserve

The Korean Commercial Act requires the Parent Company to appropriate as a legal reserve at least 10% of cash dividends paid for each accounting period until the reserve equals 50% of outstanding share capital. The legal reserve may not be utilized for cash dividends, but may only be used to offset a future deficit, if any, or may be transferred to share capital.

27.

Reserves

(1)

Details of reserves, net of taxes, as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Valuation gain on FVOCI	₩	1,570,314		262,657
Other comprehensive income of investments in associates and joint ventures		368,213		315,283
Valuation gain (loss) on derivatives		14,503		(8,044	)
Foreign currency translation differences for foreign operations		72,652		77,047

	₩	2,025,682		646,943

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

27.	Reserves, Continued

(2)

Changes in reserves for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	Valuation gain on financial assets at FVOCI		Other comprehensive income of investments in associates and joint ventures		Valuation gain (loss) on derivatives			Foreign currency translation differences for foreign operations			Total
	Valuation gain on financial assets at FVOCI				Valuation gain (loss) on derivatives						Total
Balance as of January 1, 2024	₩	176,208		182,702		(1,488	)		29,794			387,216
Changes, net of taxes		86,449		132,581		(6,556	)		47,253			259,727
Balance as of December 31, 2024	₩	262,657		315,283		(8,044	)		77,047			646,943
Balance as of January 1, 2025	₩	262,657		315,283		(8,044	)		77,047			646,943
Changes, net of taxes		1,307,657		52,930		22,547			(4,395	)		1,378,739

Balance as of December 31, 2025	₩	1,570,314		368,213		14,503			72,652			2,025,682

(3)

Changes in valuation gain (loss) on financial assets at FVOCI for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024
Balance as of January 1	₩	262,657			176,208
Amount recognized as other comprehensive income for the year, net of taxes		1,464,741			11,262
Amount reclassified to retained earnings, net of taxes		(157,084	)		75,187

Balance as of December 31	₩	1,570,314			262,657

(4)

Changes in valuation gain (loss) on derivatives for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024
Balance as of January 1	₩	(8,044	)		(1,488	)
Amount recognized as other comprehensive income (loss) for the year, net of taxes		16,408			(12,636	)
Amount reclassified to profit or loss, net of taxes		6,139			6,080

Balance as of December 31	₩	14,503			(8,044	)

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

28.	Other Operating Income and Expenses

Details of other operating income and

expenses for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Other operating income:
Gain on disposal of property and equipment and intangible assets	₩	127,058		37,316		21,898
Others(*1)		43,376		34,972		28,468

	₩	170,434		72,288		50,366

Other operating expenses:
Communication	₩	32,294		34,037		32,238
Utilities		591,507		547,204		511,240
Taxes and dues		68,852		44,888		29,009
Repair		425,698		438,089		431,964
Research and development		339,507		378,079		369,507
Training		29,804		30,949		39,286
Bad debt for accounts receivable – trade		44,183		49,865		37,906
Travel		14,936		19,090		22,499
Supplies and others(*2)		317,414		116,920		130,330
Loss on disposal of property and equipment and intangible assets		15,296		17,427		9,369
Impairment loss on assets held for sale		12,320		—		—
Impairment loss on property and equipment and intangible assets		3,140		94,736		10,369
Donations		15,339		15,712		14,766
Bad debt for accounts receivable – other		3,282		4,838		5,256
Others(*1,3)		145,771		72,122		7,534

	₩	2,059,343		1,863,956		1,651,273

(*1)

See note 4 (2).

(*2)

Supplies and others operating expenses include ₩211,998 million

of costs incurred in response to the cybersecurity incident related to cellular services segment during the year ended December 31, 2025. The portion of these estimated costs that remained unpaid as of December 31, 2025 are recognized as a provision. (See note 19)

(*3)

Others include penalties of ₩134,799 million

imposed by the Personal Information Protection Commission in connection with the cybersecurity incident related to cellular services segment during that occurred cellular service segment during the year ended December 31, 2025.

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

29.	Finance Income and Costs

(1)

Details of finance income and costs for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Finance income:
Interest income	₩	73,064		87,245		70,055
Dividends		57,060		35,818		43,014
Gain on foreign currency transactions		27,307		32,260		19,065
Gain on foreign currency translations		3,671		9,344		1,199
Gain relating to financial instruments at FVTPL		58,256		190,368		115,043

	₩	219,358		355,035		248,376

Finance costs:
Interest expense	₩	383,205		403,129		389,813
Loss on sale of accounts receivable – other		17,513		35,317		65,027
Loss on foreign currency transactions		30,777		30,892		21,693
Loss on foreign currency translations		3,029		3,575		1,227
Loss relating to financial instruments at FVTPL		16,350		133,006		49,641
Loss on settlement of derivatives		7,298		—		—
Loss on repayment of debentures		468		—		—
Other finance costs		23,356		—		—

	₩	481,996		605,919		527,401

(2)

Details of interest income included in finance income for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Interest income on cash equivalents and financial instruments	₩	47,851		57,731		44,921
Interest income on loans and others		25,213		29,514		25,134

	₩	73,064		87,245		70,055

(3)

Details of interest expenses included in finance costs for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Interest expense on borrowings	₩	26,300		31,718		29,917
Interest expense on debentures		277,937		272,846		247,105
Others		78,968		98,565		112,791

	₩	383,205		403,129		389,813

F-8

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

29.	Finance Income and Costs, Continued

(4)

Finance income and costs by category of financial instruments for the years ended December 31, 2025, 2024 and 2023 are as follows. Bad debt expense (reversal of loss allowance) for accounts receivable – trade, loans and receivables are presented and explained separately in notes 6 and 34.

Finance income and costs


(In millions of won)
	2025
	Finance income		Finance costs
Financial assets:
Financial assets at FVTPL	₩	84,582		38,798
Financial assets at FVOCI		56,199		23,356
Financial assets at amortized cost		72,894		33,259

		213,675		95,413

Financial liabilities:
Financial liabilities at FVTPL		2,153		2,364
Financial liabilities at amortized cost		3,530		384,219

		5,683		386,583

	₩	219,358		481,996


(In millions of won)
	2024
	Finance income		Finance costs
Financial assets:
Financial assets at FVTPL	₩	95,708		52,731
Financial assets at FVOCI		30,993		—
Financial assets at amortized cost		106,514		13,281

		233,215		66,012

Financial liabilities:
Financial liabilities at FVTPL		121,061		115,592
Financial liabilities at amortized cost		759		424,315

		121,820		539,907

	₩	355,035		605,919

F-

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

29.	Finance Income and Costs, Continued

(4)

Finance income and costs, Continued


(In millions of won)
	2023
	Finance income		Finance costs
Financial assets:
Financial assets at FVTPL	₩	127,001		114,668
Financial assets at FVOCI		39,681		—
Financial assets at amortized cost		69,373		22,795
Derivatives designated as hedging instrument		2,480		—

		238,535		137,463

Financial liabilities:
Financial liabilities at FVTPL		6,717		—
Financial liabilities at amortized cost		3,124		389,938

		9,841		389,938

	₩	248,376		527,401

Other comprehensive income (loss), net of tax


(In millions of won)
	2025		2024			2023
Financial assets:
Financial assets at FVOCI	₩	1,465,513		11,253			(18,842	)
Derivatives designated as hedging instrument		12,445		(12,398	)		(11,520	)

		1,477,958		(1,145	)		(30,362	)

Financial liabilities:
Derivatives designated as hedging instrument		10,178		5,825			(5,940	)

	₩	1,488,136		4,680			(36,302	)

(5)

Details of impairment losses for financial assets for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Accounts receivable – trade	₩	44,183		49,865		37,906
Other receivables		3,282		4,838		5,256

	₩	47,465		54,703		43,162

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

30.	Income Tax Expense

(1)

Income tax expenses for the years ended December 31, 2025, 2024 and 2023 consist of the following:


(In millions of won)
	2025		2024			2023
Current tax expense:
Current year	₩	181,348		392,192			273,936
Changes in estimates related to prior years(*)		102,033		(22,271	)		(11,590	)

		283,381		369,921			262,346

Deferred tax expense:
Changes in net deferred tax liabilities		63,796		4,749			79,896

Income tax expense	₩	347,177		374,670			342,242

(*)

Changes in estimates related to prior years are mainly composed of additional income tax or income tax refund due to a change in the interpretation of the tax authority in relation to the income tax previously recognized by the Group.

(2)

The difference between income taxes computed using the statutory corporate income tax rates and the recorded income taxes for the years ended December 31, 2025, 2024 and 2023 is attributable to the following:


(In millions of won)
	2025			2024			2023
Income taxes at statutory income tax rate	₩	172,771			450,819			382,517
Non-taxable income		(10,095	)		(9,843	)		(3,091	)
Non-deductible expenses		64,361			15,216			15,725
Tax credit and tax reduction		(26,708	)		(26,204	)		(64,829	)
Changes in unrecognized deferred taxes		(12,997	)		(37,958	)		14,354
Changes in estimates related to prior years and others		111,781			(18,340	)		(5,878	)
Changes in tax rate		48,064			980			3,444

Income tax expense	₩	347,177			374,670			342,242

(3)

Deferred taxes directly charged to (credited from) equity for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025			2024			2023
Valuation loss (gain) on financial assets measured at fair value	₩	(502,149	)		(4,499	)		12,977
Share of other comprehensive loss (gain) of investment in associates and joint ventures		(3,813	)		(15,628	)		292
Valuation loss (gain) on derivatives		(7,614	)		1,902			5,631
Remeasurement of defined benefit plans		4,301			7,266			(2,672	)
Capital surplus and others		65,996			(46	)		(53	)

	₩	(443,279	)		(11,005	)		16,175

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

30.	Income Tax Expense, Continued

(4)

Details of the changes in deferred tax assets (liabilities) for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025
	Beginning			Deferred tax income (expense)			Directly charged to (credited from) equity			Reclassified as assets held for sale			Ending
Deferred tax assets (liabilities) related to temporary differences:
Loss allowance	₩	76,590			(3,648	)		—			(11	)		72,931
Accrued interest income		(968	)		479			—			—			(489	)
Financial assets measured at fair value		(39,533	)		60,448			(502,149	)		—			(481,234	)
Investments in subsidiaries and associates		69,749			(42,234	)		(3,813	)		—			23,702
Property and equipment and intangible assets		(423,592	)		43,417			66,310			(6	)		(313,871	)
Provisions		1,331			(190	)		—			(57	)		1,084
Retirement benefit obligation		38,034			(30,206	)		4,301			(53	)		12,076
Valuation gain (loss) on derivatives		14,478			(5,439	)		(7,614	)		—			1,425
Loss on foreign currency translation		20,370			1,206			—			—			21,576
Incremental costs to acquire a contract		(722,952	)		(125,979	)		—			—			(848,931	)
Contract assets and liabilities		19,959			29,481			—			—			49,440
Right-of-use assets		(370,771	)		49,035			—			—			(321,736	)
Lease liabilities		394,206			(8,912	)		—			—			385,294
Others		(50,634	)		(22,647	)		(314	)		(4,789	)		(78,384	)

		(973,733	)		(55,189	)		(443,279	)		(4,916	)		(1,477,117	)

Deferred tax assets related to unused tax credit carryforwards:		122,533			(8,607	)		—			—			113,926

	₩	(851,200	)		(63,796	)		(443,279	)		(4,916	)		(1,363,191	)

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

30.	Income Tax Expense, Continued

(4)

Details of the changes in deferred tax assets (liabilities) for the years ended December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)
	2024
	Beginning			Deferred tax income (expense)			Directly charged to (credited from) equity			Reclassified as liabilities held for sale			Changes in consolidation scope			Ending
Deferred tax assets (liabilities) related to temporary differences:
Loss allowance	₩	75,115			1,475			—			—			—			76,590
Accrued interest income		(6,839	)		(1,395	)		—			7,266			—			(968	)
Financial assets measured at fair value		(2,526	)		(32,508	)		(4,499	)		—			—			(39,533	)
Investments in subsidiaries, associates and joint ventures		22,930			62,447			(15,628	)		—			—			69,749
Property and equipment and intangible assets		(419,413	)		(3,861	)		—			(318	)		—			(423,592	)
Provisions		1,319			12			—			—			—			1,331
Retirement benefit obligation		12,430			18,338			7,266			—			—			38,034
Valuation gain (loss) on derivatives		19,670			(7,094	)		1,902			—			—			14,478
Gain (loss) on foreign currency translation		20,667			(297	)		—			—			—			20,370
Incremental costs to acquire a contract		(718,211	)		(4,741	)		—			—			—			(722,952	)
Contract assets and liabilities		17,565			2,394			—			—			—			19,959
Right-of-use assets		(389,863	)		19,092			—			—			—			(370,771	)
Lease liabilities		388,091			6,115			—			—			—			394,206
Others		4,266			(47,646	)		(46	)		(7,486	)		278			(50,634	)

		(974,799	)		12,331			(11,005	)		(538	)		278			(973,733	)

Deferred tax assets related to unused tax loss carryforwards and tax credit carryforwards:
Tax loss carryforwards		7,150			2,812			—			689			(10,651	)		—
Tax credit		147,022			(19,892	)		—			—			(4,597	)		122,533

		154,172			(17,080	)		—			689			(15,248	)		122,533

	₩	(820,627	)		(4,749	)		(11,005	)		151			(14,970	)		(851,200	)

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

30.	Income Tax Expense, Continued

(5)

Details of temporary differences and unused tax loss carryforwards for which no deferred tax assets were recognized in the consolidated statements of financial position as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Loss allowance	₩	79,201		77,433
Investments in subsidiaries, associates and joint ventures		713,493		481,135
Other temporary differences		51,394		103,405
Unused tax loss carryforwards		99,525		126,553

The amount of unused tax loss carryforwards for which no deferred tax assets were recognized as of December 31, 2025 are expiring within the following periods:


(In millions of won)
	Unused tax loss carryforwards
Less than 1 year	₩	—
1 ~ 2 years		—
2 ~ 3 years		—
More than 3 years		99,525

	₩	99,525

(6)

Details of the aggregate temporary differences related to investments in subsidiaries and associates, for which no deferred tax liabilities were recognized in the consolidated statements of financial position as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Investments in subsidiaries and associates	₩	428,665		1,474,534

(7)

In accordance with the Pillar Two rules, the Group is required to pay

top-up

taxes when the GloBE effective tax rate of any Group entity in its jurisdictions is below the minimum tax rate of 15%. For the year ended December 31, 2025, the Group recognized ₩472 million of income tax expense related to Pillar Two (2024: nil). The Group has applied the temporary exception from recognizing and disclosing deferred tax assets and liabilities arising from the application of the Pillar Two rules.

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

31.	Earnings per Share

Earnings per share is calculated for profit attributable to owners of the Parent Company per common share and dilutive potential common share, and details are as follows.

(1)

Basic earnings per share

Basic earnings per share for the years ended December 31, 2025, 2024 and 2023 are calculated as follows:


(In millions of won, except for share data and basic earnings per share)
	2025			2024			2023
Basic earnings per share attributable to owners of the Parent Company:
Profit attributable to owners of the Parent Company	₩	408,410			1,250,155			1,093,611
Interest on hybrid bonds		(19,800	)		(19,800	)		(17,283	)

Profit attributable to owners of the Parent Company on common shares		388,610			1,230,355			1,076,328
Weighted average number of common shares outstanding (in shares)		212,953,061			212,848,138			217,264,615

Basic earnings per share (in won)	₩	1,825			5,780			4,954

Weighted average number of common shares outstanding for the years ended December 31, 2025, 2024 and 2023 are calculated as follows:


(In shares)
	2025
	Number of common shares			Weighted average number of common shares
Issued shares as of January 1, 2025		214,790,053			214,790,053
Treasury shares as of January 1, 2025		(1,903,711	)		(1,903,711	)
Disposal of treasury shares		95,933			66,719

		212,982,275			212,953,061


(In shares)
	2024
	Number of common shares			Weighted average number of common shares
Issued shares as of January 1, 2024		218,833,144			218,833,144
Treasury shares as of January 1, 2024		(6,133,414	)		(6,133,414	)
Acquisition of treasury shares		(317,000	)		(315,314	)
Disposal of treasury shares		503,612			463,722

		212,886,342			212,848,138

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

31.	Earnings per Share, Continued

(1)

Basic earnings per share, Continued

Weighted average number of common shares outstanding for the years ended December 31, 2025, 2024 and 2023 are calculated as follows, Continued:


(In shares)
	2023
	Number of common shares			Weighted average number of common shares
Issued shares as of January 1, 2023		218,833,144			218,833,144
Treasury shares as of January 1, 2023		(801,091	)		(801,091	)
Acquisition of treasury shares		(5,773,410	)		(1,154,633	)
Disposal of treasury shares		441,087			387,195

		212,699,730			217,264,615

(2)

Diluted earnings per share

Diluted earnings per share for the years ended December 31, 2025, 2024 and 2023 are calculated as follows:


(In millions of won, except for share data and diluted earnings per share)
	2025		2024		2023
Profit attributable to owners of the Parent Company on common shares	₩	388,610		1,230,355		1,076,328
Adjusted weighted average number of common shares outstanding (in shares)		212,975,220		213,428,916		217,452,721

Diluted earnings per share (in won)	₩	1,825		5,765		4,950

Adjusted weighted average number of common shares outstanding for the years ended December 31, 2025, 2024 and 2023 are calculated as follows:


(In shares)
	2025		2024		2023
Outstanding shares as of January 1		212,886,342		212,699,730		218,032,053
Effect of treasury shares		66,719		148,408		(767,438	)
Effect of share option		22,159		580,778		188,106

Adjusted weighted average number of common shares outstanding (in shares)		212,975,220		213,428,916		217,452,721

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

32.

Dividends

(1)

Details of dividends declared

Details of dividend declared in the Parent Company for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won, except for face value and share data)
Year	Dividend type	Number of shares outstanding		Face value (in won)		Dividend ratio(*)			Dividends
2025	Cash dividends (Interim)		212,982,275		100		830	%	₩	176,776
	Cash dividends (Interim)		212,982,275		100		830	%		176,775

									₩	353,551

2024	Cash dividends (Interim)		212,880,865		100		830	%	₩	176,690
	Cash dividends (Interim)		212,886,342		100		830	%		176,696
	Cash dividends (Interim)		212,886,342		100		830	%		176,696
	Cash dividends (Year-end)		212,886,342		100		1,050	%		223,531

									₩	753,613

2023	Cash dividends (Interim)		218,466,141		100		830	%	₩	181,327
	Cash dividends (Interim)		218,473,140		100		830	%		181,333
	Cash dividends (Interim)		216,412,898		100		830	%		179,623
	Cash dividends (Year-end)		212,699,730		100		1,050	%		223,335

									₩	765,618

(*)

Dividend ratio is calculated by dividing dividend per share by the par value of a share.

(2)

Dividends yield ratio

Dividends

yield ratios for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In won)
Year	Dividend type	Dividend per share	Closing price at year-end	Dividend yield ratio
2025	Cash dividends	1,660	53,500	3.10%
2024	Cash dividends	3,540	55,200	6.41%
2023	Cash dividends	3,540	50,100	7.07%

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

33.	Categories of Financial Instruments

(1)

Financial assets by category as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025
	Financial assets at FVTPL		Equity instruments at FVOCI		Financial assets at amortized cost		Derivatives hedging instrument		Total
Cash and cash equivalents(*1)	₩	657,905		—		832,119		—		1,490,024
Long-term investment securities		35,217		—		—		—		35,217
Financial instruments(*1)		13,000		—		138,796		—		151,796
Long-term investment securities(*2)		162,584		3,025,988		—		—		3,188,572
Accounts receivable – trade(*1)		—		—		1,926,903		—		1,926,903
Loans and other receivables(*1)		189,963		—		682,449		—		872,412
Derivative financial assets		108,884		—		—		201,262		310,146

	₩	1,167,553		3,025,988		3,580,267		201,262		7,975,070

(*1)

Financial assets reclassified as assets held for sale as of December 31, 2025 are not included.

(*2)

The Group designated ₩3,025,988 million of equity instruments that are not held for trading as financial assets at FVOCI.


(In millions of won)
	December 31, 2024
	Financial assets at FVTPL		Equity instruments at FVOCI		Financial assets at amortized cost		Derivatives hedging instrument		Total
Cash and cash equivalents(*1)	₩	310,721		—		1,713,000		—		2,023,721
Financial instruments(*1)		5,000		—		319,263		—		324,263
Long-term investment securities(*2)		138,789		1,739,133		—		—		1,877,922
Accounts receivable – trade(*1)		—		—		2,000,382		—		2,000,382
Loans and other receivables(*1)		223,761		—		697,216		—		920,977
Derivative financial assets		70,311		—		—		270,797		341,108

	₩	748,582		1,739,133		4,729,861		270,797		7,488,373

(*1)

Financial assets reclassified as assets held for sale as of December 31, 2024 are not included.

(*2)

The Group designated ₩1,739,133 million of equity instruments that are not held for trading as financial assets at FVOCI.

F-9

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

33.	Categories of Financial Instruments, Continued

(2)

Financial liabilities by category as of December 31, 2025 and 2024 are as follows:


(In millions of won)	December 31, 2025
	Financial liabilities at FVTPL		Financial liabilities at amortized cost		Derivatives hedging instrument		Total
Accounts payable – trade	₩	—		110,867		—		110,867
Derivative financial liabilities		5,782		—		621		6,403
Borrowings		—		633,125		—		633,125
Debentures		—		8,213,904		—		8,213,904
Lease liabilities(*1,2)		—		1,525,798		—		1,525,798
Accounts payable – other and others(*2)		—		3,506,048		—		3,506,048

	₩	5,782		13,989,742		621		13,996,145

(*1)

The categorization of financial liabilities is not applicable to lease liabilities, but they are classified as financial liabilities measured at amortized cost, considering the nature of measuring liabilities.

(*2)

Financial liabilities reclassified as liabilities held for sale as of December 31, 2025 are not included.


(In millions of won)	December 31, 2024
	Financial liabilities at FVTPL		Financial liabilities at amortized cost		Derivatives hedging instrument		Total
Accounts payable – trade	₩	—		126,508		—		126,508
Derivative financial liabilities		2,689		—		748		3,437
Borrowings		—		615,600		—		615,600
Debentures		—		8,511,280		—		8,511,280
Lease liabilities(*1,2)		—		1,637,951		—		1,637,951
Accounts payable – other and others(*2)		—		5,018,850		—		5,018,850

	₩	2,689		15,910,189		748		15,913,626

(*1)

(*2)

Financial liabilities reclassified as liabilities held for sale as of December 31, 2024 are not included.

F-

100

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management

(1)

Financial risk management

The Group is exposed to market risk, credit risk and liquidity risk. Market risk refers to the risk of fluctuations in market variables such as foreign exchange rates, interest rates and the prices of financial instruments. The Group has established a risk management framework to monitor and manage these risks on an ongoing basis.

The Group’s financial assets consist of cash and cash equivalents, financial instruments, long-term investment securities, accounts receivable – trade and other, etc. Financial liabilities consist of accounts payable – other and others, borrowings, debentures, lease liabilities and others.

Market risk

(i)

Currency risk

The Group is exposed to foreign currency risk arising from revenues and expenses denominated in foreign currencies in the course of its global operations. The primary foreign currencies in which such risk arises are the USD, EUR and others. The Group establishes its currency risk management policy by considering the nature of each business and the availability of hedging or risk-mitigating strategies for each Group entity. The Group regularly monitors, evaluates, and manages its foreign currency exposures through established risk management processes for receivables and payables denominated in foreign currencies. Currency risk arises from both forecasted transactions and recognized assets and liabilities which are denominated in a currency other than the functional currency of each Group entity.

Monetary assets and liabilities denominated in foreign currencies as of December 31, 2025 are as follows:


(In millions of won, thousands of foreign currencies)
	Assets				Liabilities
	Foreign currencies		Won equivalent		Foreign currencies		Won equivalent
USD		106,150	₩	152,314		1,021,242	₩	1,465,380
EUR		6,031		10,168		1		1
Others		—		1,071		—		14,504

			₩	163,553			₩	1,479,885

In addition, the Group has entered into cross currency swaps to hedge against currency risk related to foreign currency debentures. (See note 21)

As of December 31, 2025, a hypothetical change in exchange rates by 10% would have increased (decreased) the Group’s profit before income tax and equity as follows:


(In millions of won)
	Profit before income tax									Equity
	If increased by 10%			If decreased by 10%			If increased by 10%			If decreased by 10%
USD	₩	11,616			(11,616	)	₩	8,541			(8,541	)
EUR		1,017			(1,017	)		748			(748	)
Others		(1,343	)		1,343			(987	)		987

	₩	11,290			(11,290	)	₩	8,302			(8,302	)

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(1)

Financial risk management, Continued

Market risk, Continued

(ii)

Interest rate risk

The Group is exposed to interest rate risk arising from its borrowings, debentures and long-term payables – other. As the Group’s interest-bearing assets are predominantly fixed-rate instruments, changes in market interest rates do not have a significant impact on the Group’s revenue or operating cash flows.

The Group conducts various analyses to manage interest rate risk and optimize its financing structure. To mitigate the impact of interest rate fluctuations, the Group employs a range of strategies, including refinancing, renewing existing borrowings, alternative financing arrangements and hedging.

As of December 31, 2025, the par values of floating-rate borrowings and debentures amount to ₩200,000 million and W430,470 million, respectively. The Group has entered into interest rate swaps to hedge interest rate risk related to the floating-rate borrowings and debentures. Therefore, changes in interest rates on the underlying floating-rate borrowings and debentures would not have affected profit before income tax for the year ended December 31, 2025. (See note 21)

As of December 31, 2025, the per values of floating-rate long-term payables – other amount to ₩551,925 million. Assuming all other variables remain constant, the impact of changes in the interest rate of long-term payables – other by 1%p on profit before income tax and equity for the year ended December 31, 2025 is as follows.

(In millions of won)


Profit before income tax					Equity
If increased by 1%p			If decreased by 1%p		If increased by 1%p			If decreased by 1%p
₩	(5,519	)		5,519	₩	(4,058	)		4,058

(iii)

Price fluctuation risk

As of December 31, 2025, the Group holds equity instruments that are traded in an active market and is therefore exposed to the risk of fluctuations in market prices. Assuming all other variables remain constant, the impact of changes in

per-share

stock price of the equity securities on profit before income tax and equity for the year ended December 31, 2025 is as follows.

(In millions of won)

Profit before income tax

Equity

If increased by 10%

If decreased by 10%

If increased by 10%

If decreased by 10%

₩

—

₩

—

₩

71,077

(71,077

)

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(1)

Financial risk management, Continued

Credit risk

Maximum credit exposure as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025		December 31, 2024
Cash and cash equivalents(*)	₩	1,489,850		2,023,543
Financial instruments(*)		151,796		324,263
Accounts receivable – trade(*)		1,926,903		2,000,382
Long-term investment securities		2,651		2,205
Contract assets		188,609		136,737
Loans and other receivables(*)		872,412		920,977
Derivative financial assets		310,146		341,108

	₩	4,942,367		5,749,215

(*)

Amounts reclassified as assets held for sale as of December 31, 2025 and 2024 are not included.

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its co

ntr

actual obligations. To manage credit risk, the Group evaluates the credit worthiness of each customer or counterparty by considering the party’s financial information, its own trading records and other factors. Based on such information, the Group establishes credit limits for each customer or counterparty.

(i)

Accounts receivable – trade and contract assets

The Group recognizes a loss allowance for accounts receivable – trade and contract assets. The allowance consists of a specific component for individually significant exposures and a collective component for groups of similar assets where credit losses are expected to occur. The collective loss allowance is determined based on historical data of collection statistics for similar financial assets. Details of changes in loss allowance for the year ended December 31, 2025 are included in note 6.

(ii)

Debt investments

Credit risk arises from debt investments included in financial instruments of ₩151,796 million, loans and other receivables of ₩872,412 million, and long-term investment securities of ₩2,651 million. To limit the exposure to this risk, the Group transacts only with financial institutions whose credit ratings are assessed as low credit risk.

Most of the Group’s debt investments are assessed to have a low risk of default and the counterparties are considered to have a strong capacity to meet their contractual cash flow obligations in the near term. Accordingly, the Group measures the loss allowance for these debt investments at an amount equal to

12-month

expected credit losses.

Meanwhile, the Group monitors changes in credit risk at each reporting date. The Group measures the loss allowance at an amount equal to lifetime expected credit losses when the credit risk of a debt investments is assessed to have increased significantly since initial recognition (presumed when it is more than 30 days past due).

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(1)

Financial risk management, Continued

Credit risk, Continued

(ii)

Debt investments, Continued

The Group’s maximum exposure to credit risk is equal to each financial asset’s carrying amount. The gross carrying amounts of each financial asset except for the accounts receivable – trade and derivative financial assets as of December 31, 2025 are as follows.


(In millions of won)
			Financial assets at amortized cost
	Financial assets at FVTPL		12-month ECL			Lifetime ECL – not credit impaired			Lifetime ECL – credit impaired
Gross amount	₩	205,614		812,203			10,342			39,013
Loss allowance		—		(2,262	)		(3,330	)		(34,721	)

Carrying amount	₩	205,614		809,941			7,012			4,292

Changes in loss allowance for debt investments for the year ended December 31, 2025 are as follows:


(In millions of won)
	12-month ECL			Lifetime ECL – not credit impaired			Lifetime ECL – credit impaired			Total
December 31, 2024	₩	3,343			4,004			60,238			67,585
Remeasurement of loss allowance, net		2,249			227			806			3,282
Transfer to lifetime ECL – not credit impaired		(3,330	)		3,330			—			—
Transfer to lifetime ECL – credit impaired		—			(4,231	)		4,231			—
Amounts written off		—			—			(30,685	)		(30,685	)
Recovery of amounts written off		—			—			633			633
Reclassified as assets held for sale		—			—			(502	)		(502	)

December 31, 2025	₩	2,262			3,330			34,721			40,313

(iii)

Cash and cash equivalents

As of December 31, 2025, the Group deposited ₩1,489,850 million of cash and cash equivalents (₩2,023,543 million as of December 31, 2024) with banks and financial institutions that maintain credit ratings above a specified threshold. The impairment on cash and cash equivalents was measured using a

12-month

expected credit loss model, taking into account the short-term nature of the exposure. Based on an assessment of the counterparties’ external credit ratings, the credit risk associated with these balances is considered to be low.

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(1)

Financial risk management, Continued

Liquidity risk

The Group’s approach to managing liquidity is to ensure that it maintains sufficient cash and cash equivalents and secures adequate liquidity through various committed credit lines at all times. The Group maintains sufficient liquidity based on its cash-generating capacity from operating activities and available credit facilities.

Contractual maturities of financial liabilities as of December 31, 2025 are as follows:


(In millions of won)
	Carrying amount		Contractual cash flows		Less than 1 year		1 - 5 years		More than 5 years
Accounts payable - trade	₩	110,867		110,867		110,867		—		—
Borrowings(*1)		633,125		653,644		347,513		306,131		—
Debentures(*1)		8,213,904		9,326,506		1,199,268		6,022,173		2,105,065
Lease liabilities		1,525,798		1,776,311		420,054		1,037,114		319,143
Accounts payable – other and others(*1,2)		3,506,048		3,524,280		3,323,502		200,778		—

	₩	13,989,742		15,391,608		5,401,204		7,566,196		2,424,208

(*1)

The contractual cash flow includes interest payables.

(*2)

The Group’s accounts payable – other and others includes amounts settled through supplier finance arrangements. The Group pays the amounts within the normal operating cycle, and no collateral is provided in connection with the agreements. As the payment terms have not been substantially modified, the related balances are classified as accounts payable – other and presented as operating cash flows in the statements of cash flows. Accounts payable – other and others relating to the supplier finance arrangements amount to ₩240,565 million as of December 31, 2025, which equals the amounts already received by the suppliers from the finance provider.

The Group does not expect that the cash flows included in the maturity analysis could occur significantly earlier or in significantly different amounts.

As of December 31, 2025, periods in which cash flows from cash flow hedge derivatives are expected to occur are as follows:


(In millions of won)	Carrying amount			Contractual cash flows			Less than 1 year			1 - 5 years
Assets	₩	201,262			207,405			22,033			185,372
Liabilities		(621	)		(627	)		(627	)		—

(2)

Capital management

The Group manages its capital to ensure its ability to continue as a going concern while seeking to maximize shareholder returns through the optimization of its debt and equity structure. The overall capital management strategy of the Group is the same as that of the Group as of and for the year ended December 31, 2024.

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(2)

Capital management, Continued

The Group monitors its

debt-to-equity

ratio as a key indicator of capital management. This ratio is calculated as total liabilities divided by total equity, based on the amounts presented in the consolidated financial statements.

Debt-to-equity

ratio as of December 31, 2025 and 2024 are as follows:


(In millions of won)
	December 31, 2025			December 31, 2024
Total liabilities	₩	17,152,491			18,687,621
Total equity		12,955,292			11,827,634

Debt-to-equity ratios		132.40	%		158.00	%

(3)

Fair value

Fair value and carrying amount of financial assets and liabilities including fair value hierarchy as of December 31, 2025 are as follows:


(In millions of won)
	December 31, 2025
	Carrying amount		Level 1		Level 2		Level 3		Total
Financial assets that are measured at fair value:
FVTPL	₩	1,167,553		—		896,085		271,468		1,167,553
Derivative hedging instruments		201,262		—		201,262		—		201,262
FVOCI		3,025,988		966,666		—		2,059,322		3,025,988

	₩	4,394,803		966,666		1,097,347		2,330,790		4,394,803

Financial liabilities that are measured at fair value:
FVTPL		5,782		—		26		5,756		5,782
Derivative hedging instruments		621		—		621		—		621

	₩	6,403		—		647		5,756		6,403

Financial liabilities that are not measured at fair value:
Borrowings	₩	633,125		—		634,241		—		634,241
Debentures		8,213,904		—		8,183,670		—		8,183,670
Long-term payables – other		547,961		—		553,807		—		553,807

	₩	9,394,990		—		9,371,718		—		9,371,718

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(3)

Fair value, Continued

Fair value and carrying amount of financial assets and liabilities including fair value hierarchy as of December 31, 2024 are as follows:


(In millions of won)	December 31, 2024
	Carrying amount		Level 1		Level 2		Level 3		Total
Financial assets that are measured at fair value:
FVTPL	₩	748,582		—		539,481		209,101		748,582
Derivative hedging instruments		270,797		—		270,797		—		270,797
FVOCI		1,739,133		1,088,578		171,967		478,588		1,739,133

	₩	2,758,512		1,088,578		982,245		687,689		2,758,512

Financial liabilities that are measured at fair value:
FVTPL		2,689		—		—		2,689		2,689
Derivative hedging instruments		748		—		748		—		748

	₩	3,437		—		748		2,689		3,437

Financial liabilities that are not measured at fair value:
Borrowings	₩	615,600		—		619,325		—		619,325
Debentures		8,511,280		—		8,582,255		—		8,582,255
Long-term payables – other		907,720		—		930,604		—		930,604

	₩	10,034,600		—		10,132,184		—		10,132,184

Interest rates used by the Group for the fair value measurement as of December 31, 2025 are as follows:


		Interest rate
Derivative instruments		1.52% ~ 17.92%
Borrowings and debentures		3.06% ~ 3.45%
Long-term payables – other		2.95% ~ 3.16%

The above information does not include fair values of financial assets and liabilities of which fair values have not been measured as carrying amounts are reasonable approximation of fair values.

Fair value of the financial instruments that are traded in an active market (financial assets at FVOCI) is measured based on the bid price at the end of the reporting date.

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(3)

Fair value, Continued

The Group uses various valuation methods and inputs for determination of fair value of financial instruments that are not traded in an active market. The valuation techniques and inputs used for recurring and

non-recurring

fair value measurements classified within Level 2 and Level 3 of the fair value hierarchy by the Group are as follows:


	Level	Valuation methods	Inputs
Financial assets at FVPL	2	Market approach, Discounted cash flow model	Discount rate
	3	Binominal option pricing model	Discount rate, Underlying asset price, Volatility
Financial assets at FVOCI	3	Market approach, Monte Caro simulation model	Comparable transaction price, Expected maturity, Volatility, Discount rate
Derivative hedging instruments	2	Discounted cash flow model	Discount rate
Financial liabilities at FVPL	2	Discounted cash flow model	Discount rate
	3	Binominal option pricing model	Discount rate, Underlying asset price, Volatility

There have been no transfers between Level 1 and Level 2 for the year ended December 31, 2025. The changes of financial assets and liabilities classified as Level 3 for the year ended December 31, 2025 are as follows:


(In millions of won)
	Balance as of January 1, 2025	Gain (loss) for the year			OCI			Acquisition			Disposal			Transfer(*)		Balance as of December 31, 2025
Financial assets
FVTPL	₩ 209,101		44,599			(1,271	)		27,312			(20,591	)		12,319		271,469
FVOCI	478,588		—			1,348,399			1,424			(49,468	)		280,379		2,059,322

	₩687,689		44,599			1,347,128			28,736			(70,059	)		292,698		2,330,791

Financial liabilities
FVTPL	₩(2,689)		(204	)		—			(13,279	)		10,416			—		(5,756	)

(*)

Transfer includes amounts transferred between levels in the fair value hierarchy due to changes in the availability of observable market inputs for the financial instruments.

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

34.	Financial Risk Management, Continued

(4)

Enforceable master netting agreement or similar agreement

Carrying amounts of financial instruments recognized to which offset agreements are applicable as of December 31, 2025 and 2024 are as follows:


(In millions of won)	December 31, 2025
	Gross financial instruments recognized		Amount offset			Net financial instruments presented on the consolidated statements of financial position
Financial assets:
Accounts receivable – trade and others	₩	222,477		(209,487	)		12,990
Financial liabilities:
Accounts payable – other and others	₩	213,881		(209,487	)		4,394

(In millions of won)	December 31, 2024
	Gross financial instruments recognized		Amount offset			Net financial instruments presented on the consolidated statements of financial position
Financial assets:
Accounts receivable – trade and others	₩	186,284		(174,372	)		11,912
Financial liabilities:
Accounts payable – other and others	₩	180,323		(174,372	)		5,951

35.	Transactions with Related Parties

(1)

List of related parties


Relationship		Company
Ultimate controlling entity		SK Inc.
Joint venture		UTC Kakao-SK Telecom ESG Fund
Associates(*)		SK China Company Ltd. and 40 others
Others		The ultimate controlling entity’s subsidiaries, associates and others

(*)	Associates include investments that are measured in accordance with IFRS 9 in which the Group has significant influence but is determined to have no substantive access to returns associated with its ownership interest.

For the periods presented, the Group is part of SK Group, a conglomerate as defined in the

Monopoly Regulation and Fair Trade Act

of the Republic of Korea. All other entities included in SK Group are there considered related parties of the Group.

F-10

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

35.	Transactions with Related Parties, Continued

(2)

Compensation for the key management

The Parent Company considers registered directors who have substantial roles and responsibilities in the planning, operations, and oversight of relevant controls of the business to be key management personnel. The compensation given to such key management for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025			2024		2023
Salaries	₩	6,727			5,673		4,139
Defined benefits plan expenses		1,038			1,362		1,005
Share option		(181	)		977		2,542

	₩	7,584			8,012		7,686

Compensation for the key management includes salaries,

non-monetary

benefits, defined benefit relating to the pension plan, and share-based compensation expenses.

(3)

Transactions with related parties for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)		2025
Scope	Company	Operating revenue and others		Operating expenses and others(*1)		Acquisition of property and equipment and others
Ultimate controlling entity	SK Inc.(*2)	₩	34,002		618,183		256,314

Associates	SK m&service Co., Ltd.		4,584		34,214		1,211
	Penguin Solutions, Inc.(*3)		15,191		—		99,822
	Others(*4,5)		22,144		25,439		129

			41,919		59,653		101,162

Others	SK Innovation Co., Ltd.		8,566		18,819		2,050
	SK Energy Co., Ltd.		1,793		74		—
	SK Geo Centric Co., Ltd.		810		320		—
	SK Networks Co., Ltd.(*6)		9,786		977,911		—
	SK Networks Service Co., Ltd.		4,964		60,740		3,928
	SK Ecoplant Co., Ltd.		2,959		286		34,765
	SK hynix Inc.		64,330		792		—
	SK Shieldus Co., Ltd.		54,407		178,304		29,009
	Content Wavve Corp.		8,422		59,667		—
	Eleven Street Co., Ltd.		72,221		29,817		—
	SK Planet Co., Ltd.		7,990		74,562		1,670
	SK intellix Co.,Ltd. (Formerly, SK Magic Co., Ltd.)		1,391		1,165		—
	Tmap Mobility Co., Ltd.		12,221		5,503		—
	Onestore Co., Ltd.		12,365		37		—
	Dreamus Company		3,915		50,339		—
	UNA Engineering Inc.		92		57,350		47,061
	Happy Narae Co., Ltd.		709		32,268		42,137
	SK REIT Co., Ltd.(*7)		215,701		1,174		—
	Others		39,459		50,603		20,130

			522,101		1,599,731		180,750

		₩	598,022		2,277,567		538,226

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

35.	Transactions with Related Parties, Continued

(3)

Transactions with related parties for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:

(*1)	Operating expenses and others include lease payments by the Group.

(*2)	Operating expenses and others include ₩177,961 million of dividends paid by the Parent Company.

(*3)	Operating revenue and others include ₩15,191 million of dividends received.

(*4)	The disposal of the shares in F&U Credit Information Co., Ltd. held by the Group was completed on April 4, 2025, and the transactions subsequent to the disposal have not been included.

(*5)	Operating revenue and others include ₩18,339 million of dividends received which was deducted from the investment in associates.

(*6)	Operating expenses and others include costs for handset purchases amounting to ₩914,042 million.

(*7)

Operating revenue and others include ₩215,699 million

arising from the disposal of the office building located in Seongnam-si, Gyeonggi-do pursuant to a sale and leaseback agreement. In connection with this transaction, right-of-use assets and lease liabilities increased

by ₩20,583 million and ₩61,778 million, respectively, for the year ended December 31, 2025.


(In millions of won)		2024
Scope	Company	Operating revenue and others		Operating expenses and others(*1)		Acquisition of property and equipment and others
Ultimate controlling entity	SK Inc.(*2)	₩	19,501		660,578		125,691

Associates	F&U Credit information Co., Ltd.		3,227		48,035		266
	SK AMERICAS Inc. (Formerly, SK USA Inc.)		649		5,462		—
	Daehan Kanggun BcN Co., Ltd.		9,551		—		—
	Others(*3)		10,154		13,051		296

			23,581		66,548		562

Others	SK Innovation Co., Ltd.		14,630		16,757		—
	SK Energy Co., Ltd.		3,822		264		—
	SK Geo Centric Co., Ltd.		847		187		—
	SK Networks Co., Ltd.(*4)		5,096		1,011,217		—
	SK Networks Service Co., Ltd.		5,300		67,713		4,352
	SK Ecoplant Co., Ltd.		2,993		—		—
	SK hynix Inc.		50,127		256		—
	SK Shieldus Co., Ltd.		61,040		147,587		18,863
	Content Wavve Corp.		13,432		83,164		—
	Eleven Street Co., Ltd.		69,448		31,277		—
	SK Planet Co., Ltd.		15,580		84,536		14,656
	SK RENT A CAR Co., Ltd.(*5)		8,336		14,462		169
	SK intellix Co.,Ltd. (Formerly, SK Magic Co., Ltd.)		1,522		796		—
	Tmap Mobility Co., Ltd.		24,291		6,452		—
	Onestore Co., Ltd.		14,588		1,604		—
	Dreamus Company		5,526		66,242		265
	UNA Engineering Inc.		88		55,902		50,497
	Happy Narae Co., Ltd.		1,317		15,760		108,074
	Others		47,355		75,040		25,236

		345,338		1,679,216		222,112

		₩ 388,420		2,406,342		348,365

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

35.	Transactions with Related Parties, Continued

(3)

Transactions with related parties for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:

(*1)	Operating expenses and others include lease payments by the Group.

(*2)	Operating expenses and others include ₩232,466 million of dividends paid by the Parent Company.

(*3)	Operating revenue and others include ₩7,718 million of dividends received which was deducted from the investment in associates.

(*4)	Operating expenses and others include costs for handset purchases amounting to ₩964,692 million.

(*5)	SK RENT A CAR Co., Ltd. was excluded from the related parties for the year ended December 31, 2024, and the transactions above occurred before the related party relationship terminated.


(In millions of won)		2023
Scope	Company	Operating revenue and others		Operating expenses and others(*1)		Acquisition of property and equipment and others
Ultimate controlling entity	SK Inc.(*2)	₩	21,438		633,265		120,926

Associates	F&U Credit information Co., Ltd.		3,876		49,398		552
	SK AMERICAS Inc. (Formerly, SK USA Inc.)		—		5,384		—
	Daehan Kanggun BcN Co., Ltd.		12,972		—		—
	Others(*3)		8,806		15,962		865

			25,654		70,744		1,417

Others	SK Innovation Co., Ltd.		33,571		18,977		—
	SK Energy Co., Ltd.		4,113		540		—
	SK Geo Centric Co., Ltd.		835		2		—
	SK Networks Co., Ltd.(*4)		5,876		970,662		1
	SK Networks Service Co., Ltd.		5,471		72,274		8,393
	SK Ecoplant Co., Ltd.		2,547		—		—
	SK hynix Inc.		58,725		178		—
	SK Shieldus Co., Ltd.		59,974		147,333		26,021
	Content Wavve Corp.		14,524		87,263		176
	Eleven Street Co., Ltd.		72,683		34,053		—
	SK Planet Co., Ltd.		18,308		88,250		16,338
	SK RENT A CAR Co., Ltd.		14,023		20,231		—
	SK intellix Co., Ltd. (Formerly, SK Magic Co., Ltd.)		1,632		1,142		—
	Tmap Mobility Co., Ltd.		24,862		10,003		—
	Onestore Co., Ltd.		16,265		166		—
	Dreamus Company		6,202		77,452		284
	UNA Engineering Inc.		172		50,263		52,733
	Happy Narae Co., Ltd.		1,472		35,461		92,375
	Others		52,039		21,884		13,292

			393,294		1,636,134		209,613

		₩	440,386		2,340,143		331,956

(*1)	Operating expenses and others include lease payments by the Group.

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

35.	Transactions with Related Parties, Continued

(3)

Transactions with related parties for the years ended December 31, 2025, 2024 and 2023 are as follows, Continued:

(*2)	Operating expenses and others include ₩218,019 million of dividends paid by the Parent Company.

(*3)	Operating revenue and others include ₩8,806 million of dividends received which was deducted from the investment in associates.

(*4)	Operating expenses and others include costs for handset purchases amounting to ₩915,339 million.

(4)

Account balances with related parties as of December 31, 2025 and 2024 are as follows:


(In millions of won)		December 31, 2025
		Receivables		Payables
Scope	Company	Accounts receivable – trade, etc.		Accounts payable – other, etc.
Ultimate controlling entity	SK Inc.	₩	9,193		170,652
Associates	SK m&service Co., Ltd.		700		32,081
	Others		1,009		1,790

			1,709		33,871

Others	SK Innovation Co., Ltd.		4,996		21,976
	SK Networks Co., Ltd.		258		123,865
	Mintit Co., Ltd.		2,553		2
	SK hynix Inc.		13,232		291
	Happy Narae Co., Ltd.		37		2,851
	SK Shieldus Co., Ltd.		15,393		18,754
	Content Wavve Corp.		—		6
	Incross Co., Ltd.		1,820		25,570
	Eleven Street Co., Ltd.		17,455		2,189
	SK Planet Co., Ltd.		259		5,933
	UNA Engineering Inc.		—		9,271
	SK REIT Co., Ltd.		7,890		61,835
	Others		11,895		24,816

			75,788		297,359

		₩	86,690		501,882

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

35.	Transactions with Related Parties, Continued

(4)

Account balances with related parties as of December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)		December 31, 2024
		Receivables				Payables
Scope	Company	Loans		Accounts receivable – trade, etc.		Accounts payable – other, etc.
Ultimate controlling entity	SK Inc.	₩	—		1,668		76,471
Associates	F&U Credit information Co., Ltd.		—		54		4,610
	Daehan Kanggun BcN Co., Ltd.(*)		22,147		—		—
	Others		—		5,158		7,001

			22,147		5,212		11,611

Others	SK Innovation Co., Ltd.		—		6,531		28,326
	SK Networks Co., Ltd.		—		372		140,120
	Mintit Co., Ltd.		—		4		—
	SK hynix Inc.		—		12,680		206
	Happy Narae Co., Ltd.		—		52		17,833
	SK Shieldus Co., Ltd.		—		12,582		20,515
	Content Wavve Corp.		—		1,564		7
	Incross Co., Ltd.		—		1,946		20,353
	Eleven Street Co., Ltd.		—		16,637		4,750
	SK Planet Co., Ltd.		—		980		15,491
	UNA Engineering Inc.		—		—		25,498
	Others		—		12,703		27,981

			—		66,051		301,080

		₩	22,147		72,931		389,162

(*)	As of December 31, 2024, the Parent Company recognized loss allowance for the entire balance of loans to Daehan Kanggun BcN Co., Ltd.

(5)

The Group has granted SK REIT Co., Ltd. the right of first offer regarding the disposal of specified real estates owned by the Group, and the negotiation period is three years from June 30, 2024, the date of agreement. In addition, the Group has been granted the right by SK REIT Co., Ltd. to lease the real estate in preference to a third party if SK REIT Co., Ltd. purchases the real estate from the Group.

(6)

The details of additional investments and disposal of associates for the year ended December 31, 2025 are presented in note 11.

36.	Commitments and Contingencies

(1)

Collateral assets and commitments

SK Broadband Co., Ltd., a subsidiary of the Parent Company, has pledged its properties as collateral for leases on buildings in the amount of ₩1,198 million as of December 31, 2025.

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

36.	Commitments and Contingencies, Continued

(2)

Legal claims and litigations

As of December 31, 2025, the Group is involved in various legal claims and litigations. The provision recognized in relation to these claims and litigations is immaterial. For legal claims and litigations for which no provision has been recognized, management does not believe the Group has a present obligation, nor is any such matter expected to have a material effect on the Group’s financial position or operating results in the event an outflow of resources becomes necessary.

(3)

Accounts receivable from sale of handsets

Retail stores and authorized dealers of the Parent Company sell handsets to the Parent Company’s subscribers on an installment basis. The Parent Company has entered into comprehensive agreements with these retail stores and authorized dealers to purchase the related accounts receivable from handset sales and to transfer the accounts receivable from handset sales to special purpose companies which were established with the purpose of liquidating receivables, respectively.

The accounts receivable from sale of handsets amounting to ₩205,160 million and ₩241,962 million as of December 31, 2025 and 2024, respectively, which the Parent Company purchased according to the relevant comprehensive agreements, are recognized as accounts receivable – other and long-term accounts receivable – other.

(4)

Obligation relating to

spin-off

The Parent Company completed the

spin-off

of its business of managing investments in semiconductor, New Information and Communication Technologies(“ICT”) and other businesses and making new investments on November 1, 2021. In accordance with Article

530-9

(1) of the Korean Commercial Act, the Parent Company and SK Square Co., Ltd., the

spin-off

company, are jointly and severally liable for liabilities incurred by the Parent Company prior to the

spin-off.

(5)

As of December 31, 2025, the Group has committed to incur ₩24,008 million of acquisition costs for property and equipment and intangible assets in future periods under existing arrangements.

(6)

According to the covenants associated with the Group’s bond issuances and borrowings, the Group is required to maintain certain financial ratios, including the debt ratio, within specified thresholds. The funds obtained must be used for specified purposes, and regular reporting to lenders is required. Additionally, the contracts include clauses that restrict the provision of additional collateral over the Group’s assets and limit the disposal of certain assets.

(7)

The Parent Company entered into a contract with SK Inc. for the use of Amazon Web Services (“AWS”). In accordance with the contract, the Parent Company is entitled to receive AWS services for a

ten-year

period beginning in July 2025, with a total contract value of USD 800,000,000.

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

37.	Statements of Cash Flows

(1)

Adjustments for income and expenses from operating activities for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025			2024			2023
Interest income	₩	(73,064	)		(87,245	)		(70,055	)
Dividends		(57,060	)		(35,818	)		(43,014	)
Gain on foreign currency translations		(3,671	)		(9,344	)		(1,199	)
Gain (loss) relating to investments in subsidiaries, associates and joint ventures, net		63,602			(321,787	)		(10,928	)
Gain on disposal of property and equipment and intangible assets		(127,058	)		(37,316	)		(21,898	)
Gain relating to financial instruments at FVTPL		(58,256	)		(190,368	)		(115,043	)
Other finance costs		23,367			—			—
Interest expense		383,194			403,129			389,813
Loss on foreign currency translations		3,029			3,575			1,227
Loss on repayment of debentures		468			—			—
Loss on sale of accounts receivables-other		17,513			35,317			65,027
Income tax expense		347,177			374,670			342,242
Expense related to defined benefit plan		120,568			130,581			124,439
Share option expenses (reversal)		(744	)		6,696			18,889
Bonus paid by treasury shares		262			24,988			20,420
Depreciation and amortization		3,590,217			3,699,890			3,750,796
Bad debt for accounts receivables - trade		44,183			49,865			37,906
Loss on disposal of property and equipment and intangible assets		15,296			17,427			9,369
Impairment loss on property and equipment and intangible assets		3,140			94,736			10,369
Impairment loss on assets held for sale		12,320			—			—
Bad debt for accounts receivable – other		3,282			4,838			5,256
Loss relating to financial instruments at FVTPL		16,350			133,006			49,641
Loss on disposal of investment assets		7,298			—			—
Increase in other provisions		107,924			—			—
Other income (expenses)		(2,718	)		16,373			(16,919	)

	₩	4,436,619			4,313,213			4,546,338

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

37.	Statements of Cash Flows, Continued

(2)

Changes in assets and liabilities from operating activities for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025			2024			2023
Accounts receivable – trade	₩	47,995			(69,043	)		(46,531	)
Accounts receivable – other		(44,132	)		(51,028	)		79,223
Advanced payments		15,478			4,503			3,986
Prepaid expenses		(361,744	)		(11,233	)		(2,262	)
Inventories		33,402			(35,661	)		(17,549	)
Long-term accounts receivable – other		34,179			135,823			66,036
Contract assets		(52,820	)		(6,966	)		3,877
Guarantee deposits		2,013			15,552			(2,117	)
Accounts payable – trade		(20,297	)		(10,039	)		50,442
Accounts payable – other		233,283			(161,778	)		(188,318	)
Withholdings		94,239			138,672			(3,714	)
Contract liabilities		185,984			17,213			(19,620	)
Deposits received		9,737			(1,835	)		(1,744	)
Accrued expenses		(135,674	)		81,025			(73,734	)
Provisions		(5,555	)		(160	)		(566	)
Long-term provisions		(754	)		(357	)		(1,061	)
Plan assets		82,445			6,110			(17,772	)
Retirement benefits payment		(270,415	)		(157,801	)		(99,396	)
Others		8,428			(1,810	)		(3,343	)

	₩	(144,208	)		(108,813	)		(274,163	)

(3)

Material

non-cash

transactions for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025			2024			2023
Decrease in accounts payable – other relating to the acquisition of property and equipment and intangible assets	₩	(194,029	)		(130,413	)		(305,823	)
Increase of right-of-use assets		278,554			523,494			345,761
Transfer from property and equipment to investment property		16,929			(5,482	)		13,900
Increase in accounts payable – other relating to the acquisition of shares		—			1,195,642			—

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

37.	Statements of Cash Flows, Continued

(4)

Reconciliation of liabilities arising from financing activities for the years ended December 31, 2025 and 2024 are as follows:


(In millions of won)
	2025
	January 1, 2025			Cash flows			Non-cash transactions
	January 1, 2025			Cash flows			Exchange rate changes(*1)			Fair value changes			Other changes			December 31, 2025
Total liabilities from financing activities:
Short-term borrowings	₩	100,000			30,000			—			—			—			130,000
Long-term borrowings		515,600			(12,500	)		—			—			25			503,125
Debentures		8,511,280			(246,201	)		(31,078	)		—			(20,097	)		8,213,904
Lease liabilities		1,637,951			(372,834	)		—			—			260,681			1,525,798
Long-term payables – other		907,720			(369,150	)		—			—			9,391			547,961
Derivative financial liabilities		748			—			—			(127	)		—			621
Derivative financial assets		(270,797	)		52,859			—			16,676			—			(201,262	)

	₩	11,402,502			(917,826	)		(31,078	)		16,549			250,000			10,720,147
Other cash flows from financing activities:
Payments of cash dividends				₩	(628,359	)
Payments of interest on hybrid bonds					(19,800	)
Acquisition of treasury shares
Cash outflow from transactions with the non-controlling shareholders(*2)					(1,145,870	)
Cash inflow from transactions with the non-controlling shareholders					92

					(1,793,937	)

				₩	(2,711,763	)

(*1)	The effect of changes in foreign exchange rates for financial liabilities at amortized cost.

(*2)	Includes ₩1, 145,870 million of consideration paid to non-controlling shareholders for the acquisition of additional shares in SK Broadband Co., Ltd., a subsidiary of the Parent Company, for the year ended December 31, 2025.

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

37.	Statements of Cash Flows, Continued

(4)

Reconciliation of liabilities arising from financing activities for the years ended December 31, 2025 and 2024 are as follows, Continued:


(In millions of won)
	2024
	January 1, 2024			Cash flows			Non-cash transactions
	January 1, 2024			Cash flows			Exchange rate changes(*)		Fair value changes			Other changes		December 31, 2024
Total liabilities from financing activities:
Short-term borrowings	₩	—			100,000			—		—			—		100,000
Long-term borrowings		718,078			(202,500	)		—		—			22		515,600
Debentures		8,325,643			725			179,773		—			5,139		8,511,280
Lease liabilities		1,611,433			(381,347	)		—		—			407,865		1,637,951
Long-term payables – other		1,260,453			(369,150	)		—		—			16,417		907,720
Derivative financial liabilities		9,212			—			—		(8,464	)		—		748
Derivative financial assets		(116,210	)		—			—		(154,587	)		—		(270,797	)

	₩	11,808,609			(852,272	)		179,773		(163,051	)		429,443		11,402,502
Other cash flows from financing activities:
Payments of cash dividends				₩	(804,317	)
Payments of interest on hybrid bonds					(19,800	)
Acquisition of treasury shares					(15,788	)
Cash outflow from transactions with the non-controlling shareholders					(133,393	)
Cash inflow from transactions with the non-controlling shareholders					15,717

					(957,581	)

				₩	(1,809,853	)

(*)	The effect of changes in foreign exchange rates for financial liabilities at amortized cost.

F-11

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

38.	Emissions Liabilities

(1)

The quantities of emissions rights allocated free of charge for each implementation year as of December 31, 2025 are as follows:


(In tCO2-eQ)
	Quantities allocated in 2021		Quantities allocated in 2022		Quantities allocated in 2023		Quantities allocated In 2024		Quantities allocated in 2025		Total
Emissions rights allocated free of charge(*)		1,385,433		1,602,751		1,736,918		1,766,850		1,597,964		8,089,916

(*)	Finalized changes in allocated quantities, including additional allocations, cancellations and other adjustments, have been reflected.

(2)

Changes in the quantities of emissions rights held by the Group are as follows:


(In tCO2-eQ)
	Quantities allocated in 2023			Quantities allocated in 2024			Quantities allocated in 2025			Total
Beginning		306,575			414,356			517,280			1,238,211
Allocation at no cost		1,736,918			1,766,850			1,597,964			5,101,732
Sale		(56,266	)		(41,446	)		(250,738	)		(348,450	)
Surrender or shall be surrendered		(1,572,871	)		(1,622,480	)		(1,864,506	)		(5,059,857	)

Ending		414,356			517,280			—			931,636

(3)

As of December 31, 2025, the estimated annual greenhouse gas emissions quantities of the Group are

1,864,506tCO2-eQ.

F-1

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

39.	Assets and Liabilities Held for Sale

Assets and liabilities held for sale as of December 31, 2025 and 2024 are as follows:


(In millions of won)
		December 31, 2025		December 31, 2024
Assets:
Disposal Groups(*1)	Cash and cash equivalents		₩27,569		22,986
	Accounts receivable – trade and other, net		23,591		71,401
	Prepaid expenses		1,877		1,127
	Inventories, net		6,278		3,740
	Property and equipment, net		10,866		17,412
	Investment property, net		—		1,719
	Intangible assets, net		17,795		5,655
	Right of use, net		2,646		—
	Goodwill		—		2,516
	Financial instrument		45,003		10
	Deferred tax assets		4,916		—
	Defined benefit assets		1,981		7,601
	Advanced payments and others		80		17,559
Investments in associates	F&U Credit information Co., Ltd.(*2)		—		11,138
	Daekyo Wipoongdangdang Contents Korea Fund		746		746
Long-term investment securities	Digital Content Korea Fund		—		3,395
	Central Fusion Content Fund		—		883
	P&I Cultural Innovation Fund		—		818
Property and equipment	—		141		6,133

		₩	143,489		174,839

Liabilities:
Disposal Groups(*1)	Accounts payable – other		38,637		82,206
	Withholdings		16,863		16,161
	Lease liabilities		2,910		2,745
	Contract liabilities		43		1,261
	Provisions		275		1,924
	Other current liabilities		3,885		1,904
	Current tax liabilities		4,495		—
	Deferred tax liabilities		—		151

		₩	67,108		106,352

(*1)	For the year ended December 31, 2025, the Group decided to dispose of the shares of SK stoa Co., Ltd. and Media S Co., Ltd., the consolidated subsidiaries. Accordingly, the assets and liabilities of SK stoa Co., Ltd. And Media S Co., Ltd. were reclassified as assets and liabilities held for sale.

(*2)	The Group disposed of its shares in F&U Credit information Co., Ltd., resulting in a gain of ₩7,367 million relating to investments in associates for the year ended December 31, 2025.

F-12

Table of Contents

SK TELECOM CO., LTD. and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2025, 2024 and 2023

40.	Business Combinations

(1)

2025

General Information

On July 1, 2025, SK Broadband Co., Ltd., a subsidiary of the Parent Company, acquired the Pangyo Data Center business from SK Inc., a related party.

As this transaction is a business combination under common control, the assets acquired and liabilities assumed were recognized at the carrying amounts in SK Inc.’s (the ultimate controlling entity) consolidated financial statements, and the difference between the consideration transferred and the carrying amounts of net assets acquired was recognized as capital surplus and others for the year ended December 31, 2025.

Considerations transferred and identifiable assets acquired and liabilities assumed are as follows:


(In millions of won)
	Amounts
I. Consideration transferred:
Cash and cash equivalents	₩	506,844

II. Identifiable assets acquired and liabilities assumed:
Accounts receivable – trade and other, net		19,085
Property and equipment, net		240,303
Intangible assets, net		2
Accounts payable – trade and other		(3,992	)

		255,398

III. Capital surplus and others(I - II)	₩	251,446

(2)

2024

There were no changes in the Group due to the business combinations for the year ended December 31, 2024.

(3)

2023

There were no changes in the Group due to the business combinations for the year ended December 31, 2023.

41.	Cash Dividends paid to the Parent Company

Cash dividends paid to the Parent Company for the years ended December 31, 2025, 2024 and 2023 are as follows:


(In millions of won)
	2025		2024		2023
Cash dividends received from consolidated subsidiaries	₩	180,708		173,499		159,539
Cash dividends received from associates		18,339		7,583		8,806

	₩	199,047		181,082		168,345

F-12


NYSE Corporate Governance Standards		Our Corporate Governance Practice

Corporate Governance Guidelines
Listed companies must adopt and disclose corporate governance guidelines.		We have adopted a Corporate Governance Charter, which is available (in Korean) on our website at www.sktelecom.com. We are also in compliance with the Korean Commercial Code in connection with such matters, including the governance of the board of directors.
Code of Business Conduct and Ethics
Listed companies must adopt and disclose a code of business conduct and ethics for directors, officers and employees and promptly disclose any waivers of the code for directors or executive officers.		We have adopted a Code of Business Conduct and Ethics for all of our directors, officers and employees, and such code is also available on our website at www.sktelecom.com.


Number		Description

1.1		Articles of Incorporation (translation in English)

2.1		Deposit Agreement dated as of May 31, 1996, as amended by Amendment No. 1 dated as of March 15, 1999, Amendment No. 2 dated as of April 24, 2000 and Amendment No. 3 dated as of July 24, 2002, entered into among SK Telecom Co., Ltd., Citibank, N.A., as Depositary, and all Holders and Beneficial Owners of American Depositary Shares (incorporated by reference to Exhibit 2.1 to the Registrant’s Annual Report on Form 20-F filed on June 30, 2006)

2.2		Description of Capital Stock (See Item 10.B. Memorandum and Articles of Association)

2.3		Description of American Depositary Shares (incorporated by reference to Exhibit 2.3 to the Registrant’s Annual Report on Form 20-F filed on April 29, 2020)

8.1		List of Subsidiaries of SK Telecom Co., Ltd.

11.1		SK Telecom Co., Ltd. Insider Trading Policies (incorporated by reference to Exhibit 11.1 to the Registrant’s Annual Report on Form 20-F filed on April 29, 2025)

12.1		Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

12.2		Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

13.1		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

13.2		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

15.1		Letter of EY Han Young (formerly, Ernst & Young Han Young) dated April 29, 2025 (incorporated by reference to Exhibit 15.1 to the Registrant’s Annual Report on Form 20-F filed on April 29, 2025)

97.1		SK Telecom Co., Ltd. Policy for the Recovery of Erroneously Awarded Compensation (incorporated by reference to Exhibit 97.1 to the Registrant’s Annual Report on Form 20-F filed on April 29, 2024)

101.INS		Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document

101.SCH		Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents

104		Cover page formatted as Inline XBRL and contained in Exhibit 101


SK TELECOM CO., LTD. (Registrant)

/s/ Taehee Kim
Name:		Taehee Kim
Title:		Vice President, Head of IR


(In millions of won)	Note		2025			2024			2023
Profit for the year			₩	375,084			1,387,095			1,145,937

Other comprehensive income (loss)
Items that will not be reclassified subsequently to profit or loss, net of taxes:
Net change in other comprehensive income of investments in associates and joint ventures		11,27		56,652			—			—
Remeasurement of defined benefit plans		20		(6,432	)		(25,905	)		1,853
Valuation gain (loss) on financial assets at fair value through other comprehensive income		27,29		1,465,513			11,253			(18,842	)
Items that are or may be reclassified subsequently to profit or loss, net of taxes:
Net change in other comprehensive income (loss) of investments in associates and joint ventures		11,27		(6,416	)		132,581			9,225
Net change in unrealized fair value of derivatives		21,27,29		22,623			(6,573	)		(17,460	)
Foreign currency translation differences for foreign operations		27		(2,106	)		49,420			1,257

Other comprehensive income (loss) for the year, net of taxes				1,529,834			160,776			(23,967	)

Total comprehensive income			₩	1,904,918			1,547,871			1,121,970

Total comprehensive income (loss) attributable to:
Owners of the Parent Company			₩	1,937,762			1,409,090			1,072,785
Non-controlling interests				(32,844	)		138,781			49,185


Item 10.C. Material Contracts			96
Item 10.D. Exchange Controls			96
Item 10.E. Taxation			101
Item 10.F. Dividends and Paying Agents			108
Item 10.G. Statements by Experts			108
Item 10.H. Documents on Display			108
Item 10.I. Subsidiary Information			109
Item 10.J. Annual Report to Security Holders			109
Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			109
Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES			110
Item 12.A. Debt Securities			110
Item 12.B. Warrants and Rights			110
Item 12.C. Other Securities			111
Item 12.D. American Depositary Shares			111
Part II			112
Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES			112
Item 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS			112
Item 15. CONTROLS AND PROCEDURES			112
Item 16. RESERVED			113
Item 16A. AUDIT COMMITTEE FINANCIAL EXPERT			113
Item 16B. CODE OF ETHICS			113
Item 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES			113
Item 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES			114
Item 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS			114
Item 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT			114
Item 16G. CORPORATE GOVERNANCE			114
Item 16H. MINE SAFETY DISCLOSURE			116
Item 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS			116
Item 16J. INSIDER TRADING POLICIES			117
Item 16K. CYBERSECURITY			117
Part III			120
Item 17. FINANCIAL STATEMENTS			120
Item 18. FINANCIAL STATEMENTS			120
Item 19. EXHIBITS			121


(In millions of won except for per share data)	Note		2025			2024			2023
Operating revenue and other income:
Revenue		4,35	₩	17,099,213			17,940,609			17,608,511
Other income		4,28,35		170,434			72,288			50,366

				17,269,647			18,012,897			17,658,877

Operating expenses:		35
Labor				2,711,262			2,725,765			2,488,245
Commission		7		5,494,689			5,564,289			5,549,899
Depreciation and amortization		4		3,467,134			3,560,374			3,614,766
Network interconnection				635,085			692,881			678,459
Leased lines				267,348			265,518			275,477
Advertising				182,669			186,340			235,769
Rent				134,075			136,753			142,356
Cost of goods sold		9		1,269,541			1,326,159			1,266,357
Others		4,28		2,059,343			1,863,956			1,651,273

				16,221,146			16,322,035			15,902,601

Operating profit		4		1,048,501			1,690,862			1,756,276
Finance income		4,29		219,358			355,035			248,376
Finance costs		4,29		(481,996	)		(605,919	)		(527,401	)
Gain (loss) relating to investments in subsidiaries, associates and joint ventures, net		4,11		(63,602	)		321,787			10,928

Profit before income tax		4		722,261			1,761,765			1,488,179
Income tax expense		30		347,177			374,670			342,242

Profit for the year			₩	375,084			1,387,095			1,145,937

Attributable to:
Owners of the Parent Company			₩	408,410			1,250,155			1,093,611
Non-controlling interests				(33,326	)		136,940			52,326
Earnings per share		31
Basic earnings per share (in won)			₩	1,825			5,780			4,954
Diluted earnings per share (in won)				1,825			5,765			4,950


(In millions of won)	Attributable to owners of the Parent Company																	Non-controlling interests			Total equity
	Share capital		Capital surplus (deficit) and others			Hybrid bonds			Retained earnings			Reserves			Sub-total			Non-controlling interests			Total equity
Balance as of January 1, 2023	₩	30,493		(11,965,876	)		398,759			22,463,711			391,233			11,318,320			836,876			12,155,196
Total comprehensive income (loss):
Profit for the year		—		—			—			1,093,611			—			1,093,611			52,326			1,145,937
Other comprehensive loss (note 11,20,21,27,29)		—		—			—			(16,809	)		(4,017	)		(20,826	)		(3,141	)		(23,967	)

		—		—			—			1,076,802			(4,017	)		1,072,785			49,185			1,121,970

Transactions with owners:
Annual dividends (note 32)		—		—			—			(180,967	)		—			(180,967	)		(50,557	)		(231,524	)
Interim dividends (note 32)		—		—			—			(542,282	)		—			(542,282	)		—			(542,282	)
Share option (note 25)		—		7,157			—			—			—			7,157			10,463			17,620
Interest on hybrid bonds (note 24)		—		—			—			(17,283	)		—			(17,283	)		—			(17,283	)
Redemption of hybrid bonds (note 24)		—		(1,241	)		(398,759	)		—			—			(400,000	)		—			(400,000	)
Issuance of hybrid bonds (note 24)		—		—			398,509			—			—			398,509			—			398,509
Transactions of treasury shares (note 23)		—		(265,120	)		—			—			—			(265,120	)		—			(265,120	)
Changes in ownership in subsidiaries, etc.		—		(2,073	)		—			—			—			(2,073	)		(6,614	)		(8,687	)

		—		(261,277	)		(250	)		(740,532	)		—			(1,002,059	)		(46,708	)		(1,048,767	)

Balance as of December 31, 2023	₩	30,493		(12,227,153	)		398,509			22,799,981			387,216			11,389,046			839,353			12,228,399