Seoul, Korea, 24 July, 2008 - SK Telecom (NYSE:SKM) announced its earnings for the second quarter of 2008: revenue of KRW 2.93 trillion, operating income of KRW 533 billion, and net income of KRW 298 billion.

Year on year, the revenue increased by 3.1% while operating income and net income declined 19.5% and 26.1% respectively. On a quarter-on-quarter basis, the revenue expanded by 3.3% and operating income and net income decreased 3.8% and 22.2% respectively.

Backed by continued subscriber growth, the revenue expanded approximately 3% both year on year and quarter on quarter. However, the operating income decreased with the introduction of mandatory contracts and handset installment payment plans along with increased marketing expenses resulted from expansion of WCDMA subscribers. Marketing expenses in the second quarter marked KRW 876 billion, representing a 24.6% increase year on year and a 14.3% increase quarter on quarter.

With the 33% phone-mail tariff cut started this January, the wireless Internet revenue declined by 14.8% year on year. However, on a quarter-on-quarter basis, the wireless Internet revenue expanded by 0.5% from growth in flat-rate data plan subscribers.

The 2008 2Q cumulative number of subscribers was 22.74 million, an increase of 6% or 1.39 million year on year. The number of subscribers increased by 2% or 370,000 compared to the previous quarter. The average revenue per user (ARPU) recorded KRW 43,341, down by 4% year on year and up 2% quarter on quarter.

SK Telecom’s CFO Kyou Bin Lee said, “The level of market competition in the first half of 2008 was higher than ever before as the handset subsidy ban was lifted and telecom operators introduced mandatory contract plans. We still expect uncertainties in the second half as well, but SK Telecom will raise efficiency in marketing expense management by focusing on securing core competitiveness through greater customer benefits such as bundled services with Hanaro Telecom, family discount plan, and T-to-T calling plan.”