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View the full Oct 29, 2026 version

Price: $16.78
Discount category: Below intrinsic value
Next earnings: 2026-11-12
Next earnings is estimate: Yes
Company name: KT Corporation
Sector: Telecommunications
About: KT Corporation is a telecommunications company in South Korea. It is the largest broadband provider in Korea, with about 10.2 million subscribers, and it had 28.9% of mobile phone subscribers on its own network at December 31, 2025. It also sells fixed-line telephone, IPTV, cloud, AI data center and enterprise IT services, and its subsidiaries include businesses in card payments, media and real estate. Consolidated revenue was KRW 6,679.9 billion in Q2 2026. The government limits foreign ownership of KT to 49% of its voting shares. One ADS represents one-half of one common share.
Thesis: The market prices KT as a slow-growth Korean telecom company with low returns on equity. A security incident with illegal femtocells, which the government confirmed in December 2025, led KT to waive early termination fees, and more than 233,000 subscribers left. A customer appreciation program from February to July 2026 then lowered wireless revenue. KT also plans large spending: KRW 4 trillion on cybersecurity and IT and KRW 8 trillion on network over three years, and KRW 6 trillion on AI data centers and submarine cables over five years. For the gap to close, three things must be true. Wireless service revenue must grow again after the end of the appreciation program. The consolidated operating margin must rise toward the value-up target of 9% or more by 2028, with a consolidated ROE of 9% to 10%. KT must deliver the planned returns: 50% of adjusted standalone net income each year from 2026 to 2028, plus KRW 750 billion of buybacks and cancellations, and sales of non-core assets. The Q3 2026 report, expected in November 2026, gives the next test, and the full-year 2026 results in February 2027 give a second test. If these checks pass, the gap can close slowly through 2028. The main reasons it may not close are new security costs or fines and investments that earn low returns.
Risks: The Personal Information Protection Commission is still investigating the femtocell incident, and the Ministry of Science and ICT said that it may impose fines. KT cannot yet estimate these costs. Another incident can cause more subscriber losses. KT plans large investments in security, network, AI data centers and submarine cables. If AI data center demand is weaker than planned, these projects can earn low returns and limit shareholder returns. The Korean mobile market is mature and regulated. Wireless ARPU fell 2.3% to KRW 34,412 in Q2 2026, and mobile churn rose to 1.7% in Q1 2026 during the fee waiver. The Government of Rwanda and related parties claim about KRW 512.4 billion from KT in an arbitration, about 2.63% of KT's equity. KT earns in Korean won, and the ADS trades in US dollars. A weaker won lowers the dollar value of earnings and dividends.
Balance sheet: Cash: ₩3,049.8B Debt: ₩11,270.8B Net debt: ₩8,221.0B EBITDA, last 12 months: ₩5,730.6B Net debt / EBITDA: 1.4× (low) Debt due within 12 months: ₩4,179.5B KT funds itself with bonds and bank loans, mostly in Korean won. At June 30, 2026, consolidated borrowings were KRW 11,270.8 billion: short-term borrowings of KRW 4,179.5 billion and long-term borrowings of KRW 7,091.3 billion. These figures do not include lease liabilities. Cash is cash and cash equivalents of KRW 3,049.8 billion, without other short-term financial assets. The part due within 12 months is the short-term borrowings line, as the release reports it. EBITDA is consolidated EBITDA for the four quarters from Q3 2025 to Q2 2026, as the earnings releases report it. Total equity was KRW 20,431.3 billion. KT also held non-core assets with a book value of KRW 12.3 trillion at Q2 2026: real estate of KRW 4.6 trillion, marketable securities of KRW 3.3 trillion and subsidiaries of KRW 4.4 trillion, and it plans to sell some of them. Capital spending was KRW 872.8 billion in the first half of 2026. KT returns 50% of adjusted standalone net income each year and pays a quarterly dividend of KRW 600 per share. As of 2026-06-30.
Checkpoints: Nov 12, 2026 (estimate): Q3 2026 results: wireless recovery. Pending. Watch: Wireless service revenue that stops falling after the end of the appreciation program and a higher operating margin than in Q3 2025 pass; another fall in wireless revenue or new security costs fail. 2028 (estimate): 2028 value-up targets. Pending. Watch: A consolidated ROE of 9% to 10% and an operating profit margin of 9% or more in 2028 pass; lower figures fail.
Recent events: 2026-10-23: KT reported that the Government of Rwanda and three related parties filed a counterclaim of about KRW 512.4 billion against KT in an arbitration at the Permanent Court of Arbitration. KT started the arbitration to collect a put option price of about $152 million under a shareholders' agreement. KT said that it will dispute the counterclaim. 2026-10-13: KT declared a Q3 2026 dividend of KRW 600 per share, with a record date of October 28, 2026 and payment on November 12, 2026. 2026-09-09: KT completed its KRW 250 billion treasury share trust. It bought 4,480,551 shares from April to August 2026. 2026-08-12: KT reported Q2 2026 results. Consolidated revenue fell 10.1% to KRW 6,679.9 billion and operating profit fell 36.1% to KRW 648.3 billion, because a real estate project lifted Q2 2025. Wireless service revenue fell 1.8% because of the customer appreciation program and subscriber losses during the fee waiver. KT also published its 2026 value-up plan, with a consolidated ROE target of 9% to 10% and an operating profit margin of 9% or more by 2028, and KRW 750 billion of buybacks and cancellations from 2026 to 2028. 2026-07-06: KT presented a mid-term growth plan. It plans to add 1 GW of AI data center capacity over five years. It plans to invest KRW 4 trillion in cybersecurity and IT and KRW 8 trillion in network over three years, and KRW 6 trillion in AI data centers and submarine cables over five years. 2026-05-12: KT reported Q1 2026 results, with consolidated operating profit of KRW 482.7 billion. It also set its shareholder return policy for FY2026 to FY2028: it will return 50% of adjusted standalone net income through cash dividends and share buybacks and cancellations. 2026-03-31: Yoon-Young Park, a former KT President, became Chief Executive Officer. He replaced Young-Shub Kim. 2025-12-31: After a government investigation found that weak femtocell management let attackers reach subscriber data, KT waived early termination fees from December 31, 2025 to January 13, 2026. More than 233,000 subscribers ended their contracts in that period. The investigation found unauthorized micropayments that affected 368 customers and a leak of data of about 22,227 subscribers.