SK Square (402340) Q1 2025 earnings summary

Executive summary

• Achieved record consolidated operating income of KRW 1.7tn, up KRW 1.3tn year-over-year, driven by improved SK hynix earnings and ICT portfolio performance.

• Revenue for Q1 2025 was KRW 402.8 billion, down 19.2% year-over-year, with operating income of KRW 1,652.3 billion, up sharply due to equity method gains from affiliates, notably SK hynix.

• Net profit attributable to owners was KRW 1,616.0 billion, a significant increase from KRW 344.9 billion in Q1 2024, driven by strong affiliate performance.

• All-time high first quarter revenue and operating income at SK hynix, with strong AI memory demand and HBM4 development completed.

• Portfolio rebalancing included a share swap of a 58% stake in IDQ for shares in IONQ, aiming for technological and business synergies.

Financial highlights

• Consolidated revenue reached KRW 402.8bn; net income was KRW 1,612.3bn for the quarter.

• Total assets increased to KRW 23.4 trillion from KRW 21.9 trillion at year-end 2024.

• Net asset value (NAV) increased by KRW 2.3tn year-over-year to KRW 33.5tn, mainly due to the higher value of the SK hynix stake.

• Net cash position stood at KRW 431.6bn, with no unconsolidated debt.

• Cash and cash equivalents at quarter-end were KRW 1,203.3 billion.

Outlook and guidance

• Expect continued growth in AI memory demand, targeting over 100% growth in 2025 HBM revenue.

• The group aims to strengthen its portfolio in semiconductors and ICT, focusing on affiliate synergy and digital transformation.

• Commerce and platform businesses are targeting profitability improvements through cost efficiency, AI adoption, and service innovation.

• SK planet and OK Cashbag businesses are targeting EBITDA turnarounds in 2025 through profitability improvements and new service launches.

• Ongoing investments in R&D and global expansion, especially in mobile, digital content, and mobility sectors.