SK Telecom’s artificial intelligence strategy achieved further growth in the second quarter, but it was not enough to increase its profits. The South Korean operator announced quarterly earnings of 350.5 billion Korean won ($254 million), an increase of only 0.7%, but slightly higher than analysts’ expectations of 346.2 billion Korean won ($251 million).

Revenue increased by 2.7% and operating income increased by 16%, mainly due to the one-time recognition of patent pool payments.

During Tuesday’s earnings conference call, executives pointed out that the company’s emerging AI related businesses have achieved healthy revenue growth, with data center revenue increasing by 21%, cloud computing sales increasing by 28%, and enterprise business growing by 11%. Due to the increase in users, both traditional mobile and broadband services have grown by 2.3%, with 5G currently accounting for 70% of all mobile users.

Chief Financial Officer Kim Yang seob stated that the company’s goal for this year is to raise over 60 billion Korean won ($44 million) in revenue through Gen AI, data centers, and AI solutions targeting key vertical markets. He stated that artificial intelligence data centers will provide GPU services and energy solutions, and will drive the company away from traditional data center businesses.

Kim stated that the speed and scale of artificial intelligence development require “astronomical investments”. SKT’s strategy is to collaborate with domestic and foreign artificial intelligence companies to ensure core capabilities through small-scale investments.

In its latest transaction last month, it agreed to invest $200 million in SGH, an AI computing and solutions provider listed on NASDAQ, hoping this will help drive its global AI data center business.

Other investments include investing $100 million in Silicon Valley legal management company Anthropic, $20 million in GPU cloud startup Lambda, and $10 million in artificial intelligence search engine Perplexity.

The SKT artificial intelligence personal assistant “A.” (pronounced as “point A”), launched earlier this year, currently has 4.6 million users. The company hopes to collaborate with Perplexity later this year to promote it globally.

The company also stated that it expects the development of artificial intelligence edge base stations to improve network efficiency. It is collaborating with global suppliers and other telecommunications companies to establish an artificial intelligence RAN that can support artificial intelligence and telecommunications services.

But he expressed unease about SKT’s joint efforts in artificial intelligence and traditional businesses, saying, “It hasn’t been properly reflected in the valuation of companies in the stock market, to be honest, that’s something I’m worried about as the CFO.”

He added, “In the medium to long term, we will consider increasing shareholder returns in proportion to significant profit improvements.”

SKT’s stock on the Seoul Stock Exchange fell 0.19% on Tuesday.