[Foreign Language] [Interpreted] Good morning and good evening. First of all, thank you all for joining this conference call. And now, we will begin the conference of the Fiscal Year 2022 Third Quarter Earnings Results by SK Telecom. This conference will start with a presentation followed by a divisional Q&A session. [Operator Instructions].

Now, we shall commence the presentation on the fiscal year 2022 third quarter earnings results by SK Telecom..

[Foreign Language] [Interpreted] Good afternoon, I'm Hee June Chung, IRO of SK Telecom. Thank you for joining SK Telecom's earnings conference call.

[Foreign Language] [Interpreted] We are providing consecutive interpretation for the call, which will consist of a presentation on Q3 earnings highlights, future business plans, and strategic directions, as well as a Q&A session.

[Foreign Language] [Interpreted] The call is attended by our executives from relevant business divisions including Jin-won Kim, CFO and Head of Corporate Planning of SK Telecom. [Foreign Language] [Interpreted] Before we begin, I would like to remind you that all forward-looking statements are subject to change depending on market situations.

[Foreign Language] [Interpreted] Let me now present our CFO..

[Foreign Language] [Interpreted] Good afternoon. This is Jin-won Kim, CFO of SK Telecom. [Foreign Language] [Interpreted] SK Telecom celebrated the first anniversary of the spin-off on November 1.

With the launch of SKT 2.0, we redefined our business into five business groups to ensure that each business group within the telecom business could enjoy fair recognition of its value in the market.

Even though the circumstances surrounding our business continue to be challenging, we have produced meaningful results in the telecom based new businesses on the back of stable Fixed and Mobile business performance.

[Foreign Language] [Interpreted] While the past strategy of SK Telecom was activate expansion into new business areas, SK Telecoms growth story for the next decade can be summed up as AI transformation. Customer engagement is key in this new era and AI has the potential to transform every industry.

Against this backdrop, we have been focusing on building AI capabilities over the past years. Going forward, we aim to deliver better earnings with business model innovation through AI transformation, thereby enhancing our corporate value. [Foreign Language] [Interpreted] SK Telecom will achieve a new vision of becoming a differentiated AI company.

To this end, we will transform our core businesses into AI based businesses to secure new growth drivers, offer AI services to deepen customer relations and employ AIX strategy to spread SK Telecom’s AI and digital transformation capabilities to other industries.

[Foreign Language] [Interpreted] Now let me report on the consolidated financial results of the third quarter of 2022. [Foreign Language] [Interpreted] Consolidated revenue reported KRW 4,343.4 billion, up 3.0% or year-over-year and 1.2% Q-on-Q.

[Foreign Language] [Interpreted] Operating income posted KRW 465.6 billion, up 18.5% year-on-year on the back of continuous market stabilization. It also grew 1.3% Q-on-Q mainly thanks to revenue growth supported by growing 5G subscribers.

[Foreign Language] [Interpreted] Net income recorded KRW 245.6 billion, down 66.7% year-over-year and 4.9% Q-on-Q with a recognition of disposal losses of Hana Card card equity. [Foreign Language] [Interpreted] On a non-consolidated basis, revenue grew 3.1% year-over-year and 0.1% Q-on-Q to post KRW 3,122.6 billion.

Operating income and net income reported KRW 388.7 billion and KRW 305.1 billion respectively. [Foreign Language] [Interpreted] Having reported on the financial highlights of Q3 2022, let me now move on to major achievements and strategic directions.

[Foreign Language] [Interpreted] Having ranked #1 in the National Customer Satisfaction Index and the Korean Standard Service Quality Index, we went first again in the Korean Customer Satisfaction Index in October, thereby achieving Grand Slam in all three major customer satisfaction surveys in the Mobile Communication sector for 23 consecutive years.

Thanks to strong customer support, the number of 5G subscribers reached KRW 12.47 million at the end of Q3, well on course to reach the annual target of 13 million. [Foreign Language] [Interpreted] The pay TV subscribers of SK Broadband reached 9.25 million as at the end of Q3.

Content sales have seen a recovery trend, thanks to the solid growth of the pay TV subscriber base and new film releases on the back of transition to endemic.

We expect that this growth trend will continue to be supported by diverse content offerings [Foreign Language] [Interpreted] Also TEAM Studio, our LED wall-based media content production studio that opened in June is actively expanding the media ecosystem based on hyper collaboration by creating a consortium with major virtual production companies in Korea.

SK Telecom will lead the media content production paradigm by utilizing TEAM Studio.

To this end, TEAM Studio will build intellectual property, VFX and XR related platforms which will lead the future digital content industry on top of SK Telecom’s ICT infrastructure such as 5G, AI and Cloud technologies [Foreign Language] [Interpreted] Moving on to our Data Center business, which received much attention in the market recently, growth of revenue and utilization rate is on track for Gasan and Siksa Data Centers.

Preparations to open additional data centers in areas such as the Seoul Metropolitan Area and Busan are well underway as we continue to manage the internal and external circumstances well.

[Foreign Language] [Interpreted] As the cloud market is going through restructuring centered on hyperscalers, we're focusing on MSP business, which can expand quickly the scale through hyper collaboration with global CSPs as well as edge cloud business that provides comprehensive packages that include MEC infrastructure and various solutions.

[Foreign Language] [Interpreted] Launched as an open beta version, a growing AI service named A. (A dot) is improving its service quality through constant enhancement.

In order to transform ‘A.’ into a daily digital made for customers, we are making continuous efforts including the development of a daily service package that combines a wide range of everyday services.

[Foreign Language] [Interpreted] Celebrating the first anniversary in August, T universe has become a leading subscription service in Korea with more than 1.4 million MAU by offering diverse services and benefits in connection with customer’s lifestyles, including online and offline shopping, foods and beverages and digital services.

Going forward, T universe aims to evolve as a subscription commerce platform by expanding product lineup and partnerships and enhancing customer convenience. [Foreign Language] [Interpreted] Ifland recorded 12.86 million cumulative downloads at the end of Q3.

It introduced ifland Point Program to build a foundation for an economic system and opened ifland Studio where users can create avatar costumes to further expand the scope of production to lens and items in the future. Going forward, transactions using ifland points will be enabled as well.

Moreover, in September, SK Telecom signed an MOU with e&, UAE’s #1 giant telecom company which marks the beginning of global expansion of ifland with the goal of launching metaverse services in 48 countries by the end of this year.

[Foreign Language] [Interpreted] Connected Intelligence business including UAM, an integral part of future mobility is a business that SK Telecom is pursuing with a sense of responsibility for the future of society and humanity.

We believe that UAM will be a game changer that offers innovative services to customer’s growth, upside to investors and convenient mobility services for society. [Foreign Language] [Interpreted] Finally for shareholder returns, the Board determined the third quarter EPS to be the same as Q1 and Q2 at KRW 831.

[Foreign Language] [Interpreted] SK Telecom will accelerate transformation into AI company through active cooperation with an investment in technology companies, as in the case of equity investment in Konan Technology to secure core AI technologies and talent.

In the process, we will do our best to achieve financial performance improvement and new business growth in order to maximize corporate value and shareholder value. [Foreign Language] [Interpreted] We ask for your continued support and encouragement. Thank you [Foreign Language] [Interpreted] We will now begin the Q&A session..

[Foreign Language] [Interpreted] Now Q&A session will begin please [Operator Instructions] The first question you will be provided by Seyon Park from Morgan Stanley. Please go ahead with your question..

[Foreign Language] [Interpreted] I am Park Seyon from Morgan Stanley, thank you for taking my questions. I have two questions. The first question is related to the outlook for the fourth quarter. As we can see in the third quarter, and the cumulative operating earnings has grown by 17% or 18% for the standalone and consolidated basis.

So it has shown a very good growth trend. I wonder if there may be other one-off factors that may change this growth trend in the fourth quarter.

And I expect that there will be some one-off expenses that will incur in the fourth quarter as well, so what will be the size of the one-off expenses to be recognized in the fourth quarter? Of course, when we get some idea about the fourth quarter outlook, we'll be able to see an overall outlook for the entire year.

So if you could provide us with some color on the full year earnings outlook, I would appreciate that. The second question is regarding your roaming revenue. You mentioned that there has been some roaming revenue increase on a standalone basis for your wireless MNO business.

So what is the overall trend for your roaming revenue? And compared to the pre-COVID-19 numbers, how much has been recovered? And how much more recovery are you expecting?.

[Foreign Language] [Interpreted] Thank you for your questions. I will first like to address your question on the fourth quarter outlook and annual outlook. [Foreign Language] [Interpreted] I'm sure many of you who are participating in this conference call are aware -- well aware of our earnings trend on a quarter-by-quarter basis.

[Foreign Language] [Interpreted] When it comes to the revenue trend, I believe that this trend for revenue side from the first quarter all the way to the third quarter will continue into the fourth quarter.

But when it comes to the expenses or costs, there are some structural factors that will lead to more expenses recognized in the fourth quarter compared to the first quarter.

[Foreign Language] [Interpreted] Such expense categories include outsourced services, general fees and commissions, advertising and promotion costs, rents and other maintenance costs. And these will be recognized in the fourth quarter as has been in the case for the past years.

[Foreign Language] [Interpreted] I would also like to remind you that in the fourth quarter of last year, that was one-off labor expense recognition due to stock option and payout. And this year we expect that there will be some impact coming from the rising inflation and the cost of living.

But on an year-over-year basis, we believe that the bottom line will improve as expected. [Foreign Language] [Interpreted] While we did not provide guidance on the operating income in the beginning of this year, our revenue growth trend and the cost management trends have all been on track.

So we believe that our internal guidance and target for the operating income is going to be achieved. [Foreign Language] [Interpreted] Going forward, we expect that prices including the electricity price will continue to rise as a result of rising inflation.

Therefore, we will continue to make efforts to increase our expense efficiency and cost efficiency so that there will be minimal impact from such price increases on our earnings. [Foreign Language] [Interpreted] Your next question was about our roaming revenue.

As you can see, roaming is a business model that has been affected the hardest by the COVID-19 pandemic because roaming revenue depends on the people who are traveling overseas. [Foreign Language] [Interpreted] In 2021, the annual roaming revenue was only 15% of what we had in 2019.

[Foreign Language] [Interpreted] And this year, there have been many lifting of COVID related restrictions and such is the case in many advanced countries. Therefore, there is an increasing trend for business travelers and tourists. So we have seen a turnaround in our roaming revenue trend as well.

[Foreign Language] [Interpreted] Thanks to this turnaround trend in the third quarter, our roaming revenue has achieved a three-fold increase on an year-over-year basis and this is the highest roaming revenue since the first quarter of 2020 when the COVID situation worsened.

We have been strengthening the [indiscernible] price plan which is an exclusive roaming price plan for overseas travelers and we have been executing various marketing activities including promotions and I believe that these activities have resulted in the recovery in the roaming revenue.

[Foreign Language] [Interpreted] While overseas travel has not recovered to the level of pre-COVID era, we have seen a change in the patterns of roaming usage because compared to the past, we have seen an increase in the number of people who are using roaming services by 50%.

So this has led to an increase in the roaming revenue which is quite different from the past patterns. As we expect that there will be full opening of overseas travel we will continue to improve the customer experiences for using roaming services so that we can expand our roaming customer base and increase our revenue.

[Foreign Language] [Interpreted] Thank you..

[Foreign Language] [Interpreted] The following question will be presented by Seung-woong Lee from eBest Investment & Securities. Please go ahead with your question..

[Foreign Language] [Interpreted] I am Lee Seung-woong from eBest Investment & Securities. I also have two questions. The first question is that I like to understand the background behind your decision to make equity investment in Konan Technology.

I understand that you're trying to make this transition to an AI company and I believe that such investment will bring about more cooperation and synergetic effect.

So what are you expecting from this partnership? The second question is related to your UAM business and there was some news updates in October and September regarding your UAM initiative. And I'd like to know the current status. And you mentioned that you are aiming to commercialize the UAM service in 2025.

And we still have a couple of years before that. So what is your overall medium and long term roadmap? Thank you..

[Foreign Language] [Interpreted] Thank you for your questions, I would first like to address your question related to our investment in Konan Technology. And next, Mr. [Cho Hwan Sang], Head of Corporate Development who is working on building a consortium with Joby and other partners for UAM business will address your second question.

[Foreign Language] [Interpreted] As we announced on October 27, we acquired 20.8% of equity stake in Konan Technology which is a specialized AI company in Korea.

And we also have formed a strategic partnership that includes AI technology cooperation [Foreign Language] [Interpreted] In order to achieve our AI company transformation, we have been carrying out various and promoting various AI businesses including ‘A.’, AI audio, and text processing and Vision AI and we have been working to sophisticate our capabilities.

In order to have the successful transformation, we need to have a right set of skill sets as well as AI technologies. So to this end, we have been building our own internal capabilities and hiring experts from the outside. However, it has not been easy to acquire good pool of professionals who are specialized in AI and relevant technologies.

And given this challenge, we determined that investing in Konan Technology who has proprietary technology and a long history of business will be able to add important contribution to our AI asset. [Foreign Language] [Interpreted] Konan Technology was established in 1999.

And based on their core AI technologies, they have been recognized for excellent text AI and video AI technologies. And more than half of their personnel are R&D professionals.

Therefore, we determined that having the equity ownership which is about 20%, we believe this is a significant minority shareholding of Konan Technology is going to be beneficial for us in terms of business synergy and human resources exchanges and that is why we've decided to go ahead with this investment.

[Foreign Language] [Interpreted] We expect that this investment is going to contribute to strengthening our AI core technologies and capabilities. And right after this deal was closed, the two companies started a joint synergy task force team and we're going to carry out joint AI projects based on AI professional and talent exchanges.

And we will continue to build on specific AI synergy plans based on our own technologies and experiences so that we can promote AICC, vision AI and AI semiconductor and digital twin businesses. [Foreign Language] [Interpreted] Here with us, we have Mr. [Cho Hwan Sang], Head of Corporate Strategy Office.

He's going to give you more details about our AI strategy..

[Foreign Language] [Interpreted] Hello, I am [Cho Hwan Sang], Head of Corporate Strategy Office. Let me give you some more details about our AI strategy. [Foreign Language] [Interpreted] As for our vision of SKT 2.0. we have this vision of becoming an AI company that benefits customers with technology and services.

[Foreign Language] [Interpreted] In order to achieve this vision, we have set forth with three strategies. The first one is that we are going to redefine our core existing businesses just such as Fixed and Mobile and Media and Enterprise centered around AI and we're going to innovate business models from the perspective of customers.

[Foreign Language] [Interpreted] To be specific, we would like to make sure that SKT customers are able to search for services and products and go all the way to subscribing for such services and using them. So this entire process should be provided seamlessly on the online platform.

To do that, we're going to reform and revise our entire processes and apply AI in this process. [Foreign Language] [Interpreted] Our second strategy is to apply technology and content to AI-based services that we have already launched including ‘A.’, T universe, and ifland in order to transform our customer relations.

[Foreign Language] [Interpreted] For instance, ‘A.’ is focused on developing and introducing teller services to induce more customer usage. [Foreign Language] [Interpreted] We would also like to use T universe which will have its own platform to curate the right subscription products for our customers using AI.

[Foreign Language] [Interpreted] The third strategy is called AIX, it means that we will identify industries where they need AI application or digital transformation. We're going to identify companies that we can invest and we will apply our AI and digital transformation capabilities, expand such capabilities to other industries.

[Foreign Language] [Interpreted] For instance, in the manufacturing sector, robot and vision AI can be applied to increase manufacturing productivity and also we can apply an AI technology such as X Caliber which is a video diagnosis tech solution offered by SK Telecom to upgrade services.

[Foreign Language] [Interpreted] In order to have successful transformation into AI company, we need to secure core technologies and capabilities. So in this regard, we will continue to invest in AI startups and forge strategic cooperation with these companies.

[Foreign Language] [Interpreted] So against this backdrop, I hope that you will understand that our investment in Konan Technology is one good instance where we have made this investment to secure AI capabilities. [Foreign Language] [Interpreted] So in short, our AI strategy does not involve starting new businesses.

[Foreign Language] [Interpreted] Or rather, we would like to innovate our business models using AI which includes our core businesses such as Fixed & Mobile and Enterprise. [Foreign Language] [Interpreted] And secondly, we are going to apply AI for various services so that we can deepen customer relations.

And finally, we would like to employ the AIX strategy to secure new growth drivers. Thank you..

[Foreign Language] [Interpreted] Let me now address your question related to that UAM business status and overall strategic direction and the medium and long term roadmap. We aim to add intelligence to our intrinsic core business value of connection. Therefore we have included connected intelligence as part of the five business groups under SKT 2.0.

We are planning to commercialize the UAM service for the first time in Korea in 2025 in accordance with the government's roadmap. [Foreign Language] [Interpreted] Let me discuss how we are preparing for this UAM business.

First of all, we are working to commercialize the UAM service in Korea by forging a partnership with Joby in aviation which is globally number one aircraft manufacturer as well as establishing a consortium with many stakeholders including Hana system, Korea Airport Corporation, Korea Transportation Research Institute, and Korea Meteorological Industry Technology Institute.

We have also been participating in the first stage of K-UAM Grand Challenge in order to advance our technologies and business capabilities.

[Foreign Language] [Interpreted] For instance, in August this year, we completed the construction of the 5G airspace network for all those who are participating in the Grand Challenge demonstration project that is taking place in Goheung in Jeolla Province.

Also in September as well as in October, we have signed an MOU with Jeju Special Self-Governing Province as well as Jeju Metropolitan City respectively in order to pursue cooperation for UAM pilot projects.

[Foreign Language] [Interpreted] Moving on to our competitive strength, we first of all have the world renowned telecommunications technology so that we can play a key role in establishing and building a specialized airspace network for UAM services.

And we are also capable of providing connection between UAM and ground transportation and we have technology that can offer best routes based on mobility data analysis, and we have a partnership with Joby Aviation so that we can introduce UAM aircrafts when needed. So based on these competitive advantages, we’re going to pursue this UAM business.

[Foreign Language] [Interpreted] In addition, we are making all the necessary preparations in terms of services, infrastructure and business capabilities so that these demonstration project and pilot projects can be carried out successfully.

And we're also building a foundation for UAM business by strengthening capabilities with various stakeholders including semiconductor companies, battery companies and investment partners and we are going to continue to utilize all the capabilities available from the consortium partners.

[Foreign Language] [Interpreted] When it comes to the monetization business model of UAM, the basic idea is to share the service fees paid by customers with UAM operators, vertiport operators and traffic control service providers and other participants. However UAM has not been commercialized yet.

So we are working on in devising various options for this business model. [Foreign Language] [Interpreted] Let me now give you some medium to long term roadmap for the UAM business.

In 2023, the first stage Grand Challenge will be done in terms of demonstration project in the open ground and the second stage Grand Challenge will take place in the urban area in 2024 and our goal is to launch our pilot commercial UAM service in 2025. [Foreign Language] [Interpreted] Thank you..

[Foreign Language] [Interpreted] The following question will be presented by [Su Jin Kim] from Meritz Securities. Please go ahead with your question..

[Foreign Language] [Interpreted] Hello, thank you for taking my questions. I have two questions. The first question is related to your subscription business. I can see that there was a major update of services for T universe and as a result, there has been an increasing trend of T universe subscribers.

I wonder how much of a profit or revenue contribution is coming from T universe and what is your overall plan for service and other updates? The second question is related to your metaverse platform called ifland.

I can see that there has been unstable increase in the number of users of this trend and you mentioned that you are planning for global expansion.

So what is your overall outlook for ifland and how much of a earnings contribution are you expecting from ifland?.

[Foreign Language] [Interpreted] Here with us we have Mr. Yoon Jae-woong, Head of Subscription Service Marketing Office who is in charge of the subscription service and Mr. Yang Maeng-seok, Head of Metaverse company who is dealing with ifland business. So they're going to answer your questions in a consecutive manner..

[Foreign Language] [Interpreted] Let me comment on your question related to our subscription business. Our subscription business has reached KRW 400 billion of GMV in the third quarter of 2022 showing a substantial improvement in its performance. And we expect that the subscription business GMV will reach about KRW 560 billion by the end of this year.

[Foreign Language] [Interpreted] As at the end of the third quarter, on a monthly user basis T universe has about 1.4 million users. And this growth trend is the fastest of all the non-telecom services that we have launched in the past.

In particular, it is noteworthy to mention that about 70% of the users are in their 20s all the way to the 40s and more than 48% of the subscriptions are -- have been done through online channels, which we shows that this T universe services are appealing to the younger generation that are able to utilize online services.

[Foreign Language] [Interpreted] And when it comes to the number of partners for T universe, it used to be 36 in the second quarter, but we have 74 already. [Foreign Language] [Interpreted] Since its launch T universe has been expanding its product lineup and customer benefits. We launched Universe Pass-Life and Universe Pass-Slim in July.

And we also started to offer annual subscription and the function of sharing in September. The actual number of users for these new products and services have reached more than 200,000 receiving good response from the market.

[Foreign Language] [Interpreted] Furthermore, within this year we're going to launch subscription products gifting services and delivery type subscription products and by continuing to enhance such user value, we expect to achieve a bigger growth.

[Foreign Language] [Interpreted] Now moving on to the profitability of T universe, I'd like to mention that each product unit is designed with a plus margin. [Foreign Language] [Interpreted] So T universe subscription products offer much more benefits than what the customers have to pay.

And this structure has been made possible and has been possible because we have the existing know how In terms of production, subscription product planning and operation and the building and customer management infrastructure.

And we have also been able to utilize a massive amount of customer data that we have accumulated through online and offline channels. And we have been using these customer data to actively promote end market partner’s products.

And as a result, we were able to minimize our own investment while bringing out the best terms and conditions of contracts with partners.

[Foreign Language] [Interpreted] However, the profit generated from T universe has been reinvested to improve our marketing and service development to extend the subscription base so that we can have more competitive subscription services. However going forward, starting from next year, I believe that this will bring about more earnings contribution.

[Foreign Language] [Interpreted] In the medium to long term, we wish to continue to generate profit from the T universe subscription services by generating KRW 1 trillion worth of GMV.

And for that between 2022 and 2023, we wish to achieve a two-fold growth in terms of T universe customers and the number of products and by the end of 2023, we wish to transform the T universe into an open type subscription commerce platform. [Foreign Language] [Interpreted] Thank you..

[Foreign Language] [Interpreted] Hello, I'm Yang Maeng-seok, Head of Metaverse company. Let me first comment on the current status. [Foreign Language] [Interpreted] So in September, we introduced a major service update to strengthen the metaverse ecosystem. We introduced the ifland Point Program that is used for user reward and host sponsorship.

This is the beginning of the introduction of the metaverse economic ecosystem. We also launched the ifland Studio where users can create their own avatar costumes.

And we have introduced a lounge function for first time visitors and all of these functions that are part of this major update have enhanced the user participation and increased service accessibility.

[Foreign Language] [Interpreted] We also have been continuing to expand the content ecosystem of ifland by collaborating with various content companies and creators. We are offering a singing room, a music show, a musical hall and other original content on a regular basis.

And we also offer opportunities for fans to communicate with famous artists through ultra-immersive virtual concert format. [Foreign Language] [Interpreted] Thanks to these constant improvements, we reached 12 million of the cumulative users by the end of September and continuing our growth trend.

[Foreign Language] [Interpreted] So our priority now is to expand the subscriber base and we will continue to expand the economic system on the metaverse. [Foreign Language] [Interpreted] Let me now discuss your question related to the global expansion of metaverse.

[Foreign Language] [Interpreted] SK Telecom will launch ifland services in 48 countries within November and to this end, we have been developing various content and other relevant functions and we've been closely collaborating with major telecom companies in these regions so that we can secure ifland customer base in these areas.

[Foreign Language] [Interpreted] At the time of the global launch, we will add more languages to support ifland services. And we're also going to implement a major service update that will allow the creation of various avatars and different skin colors and hairstyles and fashion.

And we're going to utilize a K-pop and other globally popular IP or intellectual property for our marketing activities, so that we can create a social metaverse where global users can communicate with one another beyond national borders [Foreign Language] [Interpreted] After the global service launch out of the 48 countries so we will see which countries are showing the most response to this ifland services and we're going to execute some events in this market.

[Foreign Language] [Interpreted] Secondly, we're going to utilize the knowledge and understanding of the local customers and services that our partner companies possess.

And so we're going to pursue some customization if ifland functions and promote content co-production and marketing to target the local customers and these are going to help offer more differentiated experiences for the local customers in these markets.

[Foreign Language] [Interpreted] One good example of our cooperation with a major global telecom company is that in September, SK Telecom signed an MOU with e& group, which is a leading telecom company in the UAE and we operated the metaverse booth together at the Dubai Information Technology Fair to promote ifland services.

Furthermore, we are now under discussions of specific partnerships with other major global telecom companies.

[Foreign Language] [Interpreted] The following question you will be presented by Neil Anderson from HSBC. Please go ahead with your question..

Thank you very much, good afternoon. I just have one question, please. And it relates to capital allocation. As this call has demonstrated, you're investing in a very wide range of projects and they have very different return timelines and presumably capital intensity.

So could you help us think and explain how you think about that at group level? And particularly if you have any balance sheet parameters or return parameters you consider when making these investments? Thank you. [Foreign Language].

[Foreign Language] [Interpreted] Often in the market, there's a recognition that SK Telecom is an MNO business or a telco. But when you take a look at our business portfolio, we not only have MNO, but also B2B, Media, Enterprise and other new businesses including AIVERSE.

[Foreign Language] [Interpreted] Because we have these diverse businesses, their customers profiles, and their markets are quite different. And the level of maturity for these businesses is also quite different. Therefore naturally, we have different expectations in terms of capital, return and performance of these businesses.

For instance, AIVERSE is a very new business and it is in the beginning stage. And we're focusing on securing critical mass for our business. And we're working on how to monetize from this business. [Foreign Language] [Interpreted] Of course, our most competitive advantage is our MNO business.

And so we have competitive network infrastructure and the platform. And we're going to utilize these network competitiveness and platform to create synergies by expanding into the relevant business areas.

Therefore, in making capital investments and other investments for these businesses, we will continue to keep the mind investment efficiency and growth contribution. [Foreign Language] [Interpreted] Therefore, after the spinoff of SK Telecom, we redefined our business into five business groups.

And we have been working to establish the most optimal systems for each of these businesses. And these are part of our SKT 2.0 paradigm. Of course, there may be many different strategies and methodologies we can apply to achieve our vision.

But when it comes to the investment, we will focus on identifying investment areas that have the most growth potential, namely Media and Enterprise and AIVERSE because these are all relevant to our core businesses.

[Foreign Language] [Interpreted] So under this overall direction, we're going to put priority on business areas that have direct relevance to our core businesses where we can create synergies and we're going to execute investments in a reasonable manner by looking at various factors.

Of course, our ultimate goal is to enhance corporate value and we're going to consider our financial situation and available resources so that make we can make investments that can be welcomed by the market. Thank you.

[Foreign Language] [Interpreted] This concludes the earnings conference call for the third quarter of 2022 of SK Telecom. Thank you..